EURUSD Moved As Expected. What’s Next?
As a follow up to our previous post on EURUSD (kindly click here), the fiber indeed met some resistance at the 1.3290 – 1.3300 area after initially being pushed by better-than-expected German unemployment change and unemployment rate for the entire eurozone. At night, news of the 1.7% 2Q GDP growth of the US (versus 1.1% forecast) bolstered the appetite for the US dollar, causing the pair to fall to a low of around 1.3210. The euro, however, recovered as the USD weakened on the Fed’s statement after that it will still maintain its bond purchases in the mean time. As a result, the pair jumped and even breached the 1.3300 resistance to mark a high at around 1.3340.
As of late, the pair has corrected back towards its previous resistance area at 1.3290 – 1.3300. If this support holds then the pair may bounce back to revisit its recent high at 1.3340. On the flip side, a fall below 1.3290 may send it down to 1.3240. Later this afternoon, the Spanish and Italian manufacturing PMI’s will be on tap. Both are seen to come in at a slight improvement over their last period’s score. Positive results from these may benefit the EUR at least in the the short term.
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