Yesterday's economic calendar was again focused on the UK statistics only, but there was no proper reaction.

What is the reason for the discrepancy of fundamental analysis from the market?

First, let's take a look at the details of the economic calendar for April 21.

The United Kingdom released its inflation data, where they recorded its growth from 0.4% to 0.7%, against the forecasted 0.8%.

This is quite a huge growth, but the market did not just ignore the data, it also worked them out in a reflective way from the viewpoint of fundamental analysis.

The reason for the discrepancy lies in investors' concerns about the high rate of change in the inflation level, as is the case in Europe and the US.

Analysis of trading charts from April 21:

After staying briefly above the level of 1.2050, the EUR/USD pair returned to the psychological level of 1.2000, as if there was no attempt to change the cycle of an oblong correction.

The trading recommendation on April 21 considered the price pullback from the high of the upward trend, but the greatest interest from sellers should have appeared below 1.2000, where the trading deals were located.

Meanwhile, the British currency managed to show a downward activity yesterday, but the market participants failed to settle below the level of 1.3900, which resulted in another stagnation in the range of 1.3900/1.3950.

Trading recommendations of EUR/USD and GBP/USD on April 22, 2021

Today, the focus of the economic calendar is the European Central Bank's meeting, where market participants will pay special attention to the comments of the regulator on the economic situation in the Eurozone.

The results of the ECB meeting will be known as early as 11:45 Universal time, but a press conference with Christine Lagarde will be held at 12:30 UTC+00, where speculative market behavior can be expected.

In turn, data on applications for America's unemployment benefits will be published synchronously with the press conference, where indicators may differ.

• The volume of initial applications for benefits may rise from 576 thousand to 617 thousand.
• The volume of repeated applications for benefits may decline from 3 731 thousand to 3 667 thousand.

The applications reflect the number of citizens who are not currently working and receiving unemployment benefits. This indicator reflects the state of the labor market, where the growth of the indicator negatively affects the level of consumption and economic growth.

To put it simply:

An increase in the number of applications leads to a weakening of the national currency, while a decrease in the indicator leads to growth.

Looking at the trading chart of EUR/USD, the amplitude fluctuations of the price can be observed above the psychological level 1.1950/1.2000/1.2050. The price values will be considered as coordinate signals: the level of 1.1990 is a sell signal in the direction of 1.1950 and 1.2080 (local high). The breakdown of this high may lead to a movement towards the range of 1.2130-1.2150.

As for the trading chart of GBP/USD, it shows that the downturn from the area of 1.4000, set on April 20, is still relevant among traders. In order for the volume of short positions to grow, the quote needs to stay below 1.3900 in the H4 time frame, which may open the way towards the 1.3850-1.3800 range in the future.

An alternative scenario of the market development considers the price fluctuation along the previous amplitude of 1.3950/1.4000.