The U.S. consumer price index climbed 0.6 percent, the second-largest advance in more than a decade. Simultaneously, U.S. treasury yields began to climb immediately after inflation numbers were released and while all these factors would have driven the U.S. dollar higher in the past, what we are seeing in present days is a lack of direction in the dollar’s performance. The greenback ended the day virtually unchanged against the euro and even lower against the British pound.
The EUR/USD trod water between 1.2195 and 1.2140, making it impossible for daytraders to benefit from these small swings. As expected, we heard nothing new from the European Central Bank where President Christine Lagarde renewed a pledge to deliver faster bond buying for now.
The GBP/USD on the other hand, trended upwards towards 1.4180 and more gains could be in play towards 1.4280.
Elsewhere, the DAX fluctuated choppily sideways without a clear direction. We will wait and see whether conditions change within the next days. For now, we will focus on a price range between 15800 and 15400.
All in all, it was none of our favorite trading days and if market conditions continue like this with the current summer doldrums accompanied by low volumes, a lack of direction and unprofitable sideways fluctuations it is not worth placing any trade.
We wish you a beautiful weekend.
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