EURUSD MUTED AS EUROZONE INFLATION SPIKES TO 13-YEAR HIGH

The euro was relatively unchanged after the relatively strong Eurozone consumer inflation data. According to Eurostat, the bloc’s consumer price index rose from 3.0% in August to 3.4% in September. This was the highest level in more than 13 years and was mostly because of energy prices. Without food and energy, the bloc’s inflation rose from 1.6% to 1.9%. In the past few weeks, energy prices for most people in Europe had risen because of the rising coal and natural gas prices. Meanwhile, data by Markit revealed that the Eurozone manufacturing PMI declined slightly to 58.6.

It was a sea of red in global equities today as worries of the American debt ceiling remained. In Europe, the DAX, FTSE 100, and CAC 40 indices declined by more than 0.75%. Similarly, in the United States, futures tied to the Dow Jones, S&P 500, and Nasdaq 100 indices declined by more than 0.50%. As the new month starts, there are worries that the Senate will not pass a bill to suspend the debt ceiling. Failure to do that will lead to a higher cost of borrowing. Stocks also declined after House Democrats delayed a vote on the bipartisan $1 trillion infrastructure bill.

The price of crude oil declined sharply as this week’s momentum waned. The price of Brent declined by more than 0.80% to $77.85 while the West Texas Intermediate (WTI) declined to $74.45. These prices were substantially lower than this week’s high of more than $80. At the same time, the price of natural gas held steady, gaining by more than 0.40%. Still, analysts believe that oil prices will keep rising in the near term as demand rises faster than supply.

EURUSD

The EURUSD pair was little changed and is trading at 1.1578, which was slightly above this week’s low of 1.1563. On the four-hour chart, the pair moved below the 25-day and 15-day moving averages. The pair is also below several key support levels, as the August low of 1.1663. It is also slightly above the lower line of the Bollinger Bands. Therefore, the pair will likely have a relief rally in the coming days since it is at the oversold level.

USDJPY

The USDJPY pair declined to a low of 111.08 after the strong Japanese economic numbers. On the four-hour chart, the pair is still slightly above the 25-day moving average. It is also above the key support level at 110.80, which was the highest level in August. Oscillators have also started declining. Therefore, the pair will likely retest the support at 110.08 and then resume the bullish trend.

BTCUSD

The BTCUSD pair rose to a high of 44,890, which was the highest point since the previous week. On the four-hour chart, the pair rose above the 25-day moving average and the key resistance at 44,000. It appears like it has established strong support at the 42,000 level. Therefore, there is a likelihood that the BTCUSD pair will keep rising as bulls target the next key resistance at 45,000.