EURUSD Movement
For the 24 hours to 23:00 GMT, EUR declined 0.12% against the USD and closed at 1.3213. Earlier the Euro had advanced following better-than-expected German business confidence data.
In Germany, the business climate index rose to a reading of 102.4 in December, against the forecast for the index to climb to 102.0 and from a reading of 101.4 in November. However, the current assessment index declined to a reading of 107.1 in December, from a reading of 108.1 in the previous month. Also, the expectations index rose to 97.9 in December, from a reading of 95.2 in the previous month. Separately, the Conference Board reported that the leading economic index remained unchanged at a reading of 101.6 in October, after dropping 0.6% in the previous month, while the coincident economic index fell to a reading of 106.4 in October from a reading of 106.8 in September.
Meanwhile, Fitch Ratings stated that the looming threat of the US fiscal cliff and the unresolved Euro-zone debt crises are the main risks to global sovereign credit quality. The latest review and outlook report from Fitch stated that the credit ratings of emerging market economies have been affected by their own vulnerabilities and their continuing exposure to developed economies.
Euro-zone’s seasonally adjusted current account surplus widened to €3.9 billion in October, from a revised €2.4 billion surplus in September, whereas construction output decreased 1.6% (MoM) in October, following a 1.3% drop in September.
Moreover, Italian industrial new orders remained unchanged in October, from a 4.0% decline in the preceding month.
In the Asian session, at GMT0400, the pair is trading at 1.3222, with the EUR trading marginally higher from yesterday’s close.
The pair is expected to find support at 1.3171, and a fall through could take it to the next support level of 1.3120. The pair is expected to find its first resistance at 1.3291, and a rise through could take it to the next resistance level of 1.3359.
Trading trends in the pair today are expected to be determined by the release of producer price index in Germany and the consumer confidence data in the Euro-zone. In the US, investors await the third quarter gross domestic product, purchases price index, the personal consumption expenditure, the CB leading indicator, existing home sales and the Philadelphia fed manufacturing survey data.
The currency pair is trading below its 20 Hr moving average and is showing convergence with its 50 Hr moving average.
