Price on the EUR/USD is likely to break the 1.05 lvl

The EUR/USD is pushing lower because of Friday's USD PCE coming out higher then expected, and the previous reading revised higher. This is supposedly the FED's favorite measure of inflation, which gives the FED additional evidence to increase rate hikes. I do not think that the FED will be inclined to raise rates in the March meeting by 50 basis points. It will likely stick to 25 basis points. I am holding onto my positions (short side) and I am looking to place a stop at the 1.06 lvl. If price does break 1.05 (which is likely), price will be able to test out the 1.0450 lvl. At this point, I am deciding on whether I want to keep holding or not because I have other pairs I am looking at.

Comment:

Price is ranging between the 1.05 and 1.07. The USD CPI will be released next week. If prices pushes and holds above the 1.07, then the 1.10 will be hit. Either by next week or the week after. The CPI surprises to the downside, price will likely test the 1.05. The thought of a 0.50% increase pushed up to 70% before the NFP, and then back to 50% after the NFP.

Comment:

Price is attempting to break below the 1.05, but isn't quite making it all the way. With the bank contagion that was happening this week, it was possible that price would break lower, with traders and investors pushing to safe haven assets. But with the Central Banks pushing liquidity back into the banks (such as Credit Sussie getting an injection of $54 Billion from the SNB), it has staved off for now a banking crisis. But is that 1.05 lvl going to be a strong support that holds or breaks and causes a huge push lower to the parity lvl? Only time will tell. But I will keep my eye on this as it would be a good trade.