EURUSD – recovery continues to face headwinds at the multi-week range ceiling; US inflation data eyed for fresh direction signals

The Euro keeps firm tone and holds in the upper side of the multi-week range in Tuesday morning, with strong recovery extending into second straight day to almost fully retrace last Thu/Fri sharp fall.

Fresh risk appetite lifted the single currency although the gains were tempered by the latest hawkish comments from Fed policymaker.

Mixed MAs setup and neutral momentum studies on daily chart contribute to sideways mode scenario, with long upper shadows on recent daily candles point to significant offers at this zone.

Recovery faced several rejections at initial Fibo barrier at 1.1247 (23.6% of 1.1711/1.1104), with further range trading expected while the action remains capped here.

Firm break higher, on the other hand, would generate initial reversal signal (end of range / base formation) and open way for fresh push higher, with violation of 1.1336 (Fibo 38.2%) needed to confirm signal.

All eyers are on today’s release of US Oct CPI report, which should provide fresh direction signals.

US inflation remains near the double of the Fed target, with core inflation also being elevated and adding to strong expectations for Dec rate hike, with possibility of Fed entering tightening cycle in early 2027, not ruled out.

However, significant drop in oil prices may partially offset hawkish expectations.

Res: 1.1247; 1.1272; 1.1300; 1.1336
Sup: 1.1206; 1.1188; 1.1130; 1.1100