Forecast for EUR/USD on February 18, 2021

EUR/USD

The euro fell 66 points yesterday on the release of strong inflation and retail sales data in the US. The overall retail sales in January rose by 5.3% versus 1.1% expected, the producer price index jumped from 0.8% y/y to 1.7% y/y. At this rate, the current general inflation rate of 1.4% may become 2.3% in half a year, which will force the Federal Reserve to revise its monetary policy faster than the market currently believes. Industrial production also showed good growth in January - growth by 0.9% against the forecast of 0.4%.

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A downward trend has settled on the daily chart - the price is below both indicator lines, the Marlin oscillator has quite reliably penetrated the bears' area. But today can still be a calm, a correction and consolidation after yesterday's breakthrough. The 1.1870-1.1915 range is still the nearest target for the euro.

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The price lingered in the accumulation range on February 8th (gray area) on the 4-hour chart. This is a very convenient place for a new consolidation, but now for a decline. If the price moves below the signal level of 1.2023 (yesterday's low), this will be a signal to continue the downward movement.

The material has been provided by InstaForex Company - www.instaforex.com

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