The price successfully broke above the downtrend line observed from the December 7th 2020. Following the break and the earnings the price peaked at 212.00 area where the 100 Day Moving Average (MA100) acted as a resistance. The price is now trading at 186.10 area with a daily bearish engulfing candle signalling a possible reversal of the upward rally. The Relative Strength Index is above the mid-50 level in bullish area but it did not pass above the 70-level into oversold area. The RSI line is pointing downwards indicating a weakness.
For the bulls, important resistance levels exist at 206.00 which is derived from an inside resistance bottom from March 11th, also at 212.00 where the MA100 stands and at 239.00 derived from an inside swing bottom on January 20th.
For the bears, Important support at 178.00 from an inside swing support top from May 11th , also at 151.08 from the May 11th bottom, and finally at 123.48 from a November 2018 bottom that is still valid.
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• It’s a relatively quiet day ahead on the economic data front. Finalized inflation figures for the Eurozone are due out later today.Stats in line with prelim numbers should deliver EUR support though the upside will likely be limited. The ECB continues to see inflation as transitory, removing near-term influence on monetary policy.
• European shares closed at a record high on Wednesday, despite caution ahead of a U.S. Federal Reserve meeting that could see it outline plans to start stimulus unwinding.
The pan-European STOXX 600 was up 0.2% to a record high of 459.86 points, marking its longest gaining streak in three-and-a-half years with a ninth straight positive session.
• The German economy will grow by a weaker-than-expected 3.3% this year as supply bottlenecks in manufacturing hold back industrial output, the Ifo economic institute predicted on Wednesday.
The lower growth forecast for Europe's largest economy represented a cut of 0.4 percentage points compared to its previous estimate from March
• British inflation unexpectedly jumped above the Bank of England's target in May when it hit 2.1%, part of a post-lockdown climb in prices that is expected gather pace.
The acceleration of the consumer price index from April's 1.5% largely reflected how weak inflation was in May 2020 when the economy was reeling from its first tight lockdown.
• The historic U.S.-brokered 1998 Irish peace agreement has been put at risk by the implementation of the Brexit divorce deal in the British province of Northern Ireland, Prime Minister Boris Johnson's top Brexit negotiator said on Wednesday.
The EU wants to protect its single market, but an effective border in the Irish Sea created by the protocol cuts off Northern Ireland from the rest of the United Kingdom - to the fury of Protestant unionists.
• At 08:00 (GMT) EU Italian Trade Balance is due. It's a measure of the difference in value between imported and exported goods during the reported month.
• At 09:00 (GMT) EU Final Consumer Price Index (CPI) is due. It's a measure of the change in the price of goods and services purchased by consumers.
• At 09:00 (GMT) EU Final Core Consumer Price Index (CPI) is due. It's a measure of the change in the price of goods and services purchased by consumers excluding food, energy, alcohol, and tobacco.
• All Day - EU Eurogroup meetings take place. The Eurogroup coordinates economic policies of the 19 euro area member states, and their initiatives and decisions can have a widespread effect on the Eurozone's economic health.
European indices Yesterday:
• DAX: -0.12%
• EURO: +0.20%
• MIB: +0.12%
• CAC: +0.20%
Sources: Investing.com, forexfactory.com, fxempire.com, cnbc.com