Buying EURUSD on weak US inflation and employment data tomorrow

The EURUSD currency pair is setting up for a correction to the level of 1.0600. Moreover, on the hourly timeframe, the pair has already retested this level twice on November 18 and 19. Now it is the turn of the daily timeframe.

Tomorrow's publication of US GDP for the third quarter and a series of price indexes of Personal Consumption Expenditures (PCE) may act as a trigger for such a move. The PCE index is considered to be the Fed's preferred indicator in determining the degree of inflationary pressure in the economy.

The momentum for EURUSD to move upwards will be provided by the demonstration of weaker US economic growth figures and low PСЕ Index. This combination of results will add more caution and restraint to the Fed on their policy easing path and weaken the USD.

The GDP is expected to reach 2.8%, the same as in the second quarter. The price index for October is expected at 0.2%, the same as in September. Similarly, with the base version of the price index in September, it was 0.3%, also 0.3% is expected.

Based on these forward-looking expectations, a scenario in which GDP comes out below 2.8% and the price index for personal consumption expenditures is below 0.2% would push EURUSD up.

The overall recommendation is to buy EURUSD provided that tomorrow's US GDP comes out below 2.8% and the Personal Consumption Expenditure Price Index is below 0.2%.

Profits should be taken at the level of 1.0600. A Stop loss could be set at the level of 1.0300. 

It is necessary to enter the deal with caution, as it is against the main trend. In addition, the US inflation and employment figures are higher than in the eurozone, which means that the US dollar is fundamentally stronger than the euro.

The volume of the opened position should be set in such a way that the value of the possible loss, fixed with the help of a protective Stop loss order, is no more than 1% of your deposit funds.