EUR/USD: in a few hours the FOMC minutes will be published

The EUR/USD remains restrained today, close to a bearish oblique crossed energetically on 5 May in the wake of inflation figures (retail prices) in the US considered reassuring. Traders will have the opportunity to learn more about the Fed's intentions in the coming months, or at least be able to speculate on its intentions, after the publication this evening (20:00 EU time) of the latest FOMC Minutes.

As a reminder, excluding food and energy, these consumer prices in the US increased in April by 0.3%, moderately therefore, and in line with the target. Over one year, these prices increased by 3.5%, compared to 3.7% the previous month.

However, two Fed executives, Michael Barr, vice-president of the Federal Reserve in charge of banking regulation, and Philip Jefferson, another vice-president of the Fed, insist that a restrictive monetary policy should remain the norm. a long time to go for a truly effective fight against inflation. A normalization of the job market, still under strong tension, is particularly necessary.

"After short-term observations, we can however consider that the progress made in recent months has been made with difficulty. In 8 months, underlying inflation (CPI core) has only slowed by 0.5%. And this echoes the numerous declarations of members of the Fed, including those of its president, highlighting the lack of significant progress in recent months", Alex Baradez (IG France) says after this key publication.

"We could therefore begin to think that the American economy needs to slow down a little more so that the Fed is convinced that inflation is indeed returning, and in a sustainable manner, towards the 2% objective, and thus proceeds to its first rate cut."

Not much to get your teeth into on Tuesday in terms of statistics, apart from the positive monthly balance of the trade balance in the Eurozone (+17.2 billion euros, below expectations). We will have to wait until this Wednesday for the calendar to thicken somewhat, with US sales of old homes (16:00), but especially Thursday with PMI activity indicators in the Eurozone and the closely monitored weekly registrations for job benefits.

Right now, the EUR/USD is trading at $1.0829.

KEY CHART ELEMENTS
On large-scale marubozu, the currency pair shattered the technical resistance level constituted by the bearish oblique drawn in black. A recovery is underway, which may ultimately result in a pullback. The conditions in terms of entry point are not met to immediately build a position on the currency pair.

MEDIUM TERM FORECAST
Considering the key graphical factors that we have mentioned, our opinion is neutral in the medium term on the EUR/USD.

We will maintain this neutral opinion as long as EUR/USD prices are positioned between support at $1.0758 and resistance at $1.0885.