EUR/USD: Euro reverses its gains in the Asian session


EURUSD Movement

For the 24 hours to 23:00 GMT, the EUR rose 0.07% against the USD and closed at 1.1525 on Friday.

Data showed that Germany’s producer price index rose 3.1% on an annual basis in August, rising at its fastest pace in 11 months and surpassing market expectations for an increase of 2.9%. In the prior month, the producer price index had climbed 3.0%. Moreover, the nation’s seasonally adjusted factory orders rebounded 2.0% on a monthly basis in August, driven by strong foreign demand and compared to a drop of 0.9% in the previous month. Market participants were expecting factory orders to advance 0.8%.

The US dollar declined against the euro, followed weaker than expected US jobs data.

In the US, data indicated that non-farm payrolls rose less than expected by 134.0K in September, following a revised gain of 270.0K in the previous month. Market anticipations was for non-farm payrolls to advance by 185.0K. Additionally, trade deficit widened less than expected to $53.2 billion in August, compared to a revised trade deficit of $50.0 billion in the previous month. Market participants had anticipated the trade deficit to widen to $53.6 billion. Meanwhile, unemployment rate fell to 3.7% in September, hitting its lowest level since 1969 and compared to a rate of 3.9% in the previous month. Market expectations was for the unemployment rate to fall to 3.8%. Average hourly earnings of all employees climbed 2.8% on an annual basis in September, at par with market expectations. In the prior month, average hourly earnings of all employees had advanced 2.9%. Moreover, consumer credit increased $20.1 billion in August, beating market forecast for a rise of $15.0 billion and compared to a revised advance of $16.6 billion in the prior month.

In the Asian session, at GMT0300, the pair is trading at 1.1515, with the EUR trading 0.09% lower against the USD from Friday’s close.

The pair is expected to find support at 1.1483, and a fall through could take it to the next support level of 1.1451. The pair is expected to find its first resistance at 1.1548, and a rise through could take it to the next resistance level of 1.1581.

Looking ahead, traders would keep a close watch on the Euro-zone’s Sentix investor confidence index for October and Germany’s industrial production data for August, slated to release in a few hours.

The currency pair is showing convergence with its 20 Hr moving average and trading above its 50 Hr moving average.

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