EURUSD Movement
For the 24 hours to 23:00 GMT, EUR declined 0.63% against the USD and closed at 1.3143, after a poor Spanish bond auction reignited worries about the Euro-zone debt crisis.
Yesterday, Spain’s Treasury sold €2.59 billion in government bonds at auction, short of a €3.5 billion target, and the yield on Spanish 10-year bonds climbed to 5.7%, up from 5.5% before the sale.
Additionally, Euro came under pressure after the European Central Bank (ECB) President, Mario Draghi, stated that the economic outlook remained subject to “downside risks”. The ECB left its key interest rate unchanged at 1.0% in April, for the fourth month in a row.
To add to concerns, retail sales in the Euro-zone fell 0.1% (MoM) in February, compared to a 1.1% rise recorded in January. Meanwhile, the Composite Output Index was revised higher to a reading of 49.1 in March, compared to the flash estimate of 48.7. Also, Services Business Activity Index in the Euro-zone was revised higher to a reading of 49.2 in March from a previous estimate of 48.7.
In Germany, PMI for the service sector was revised higher to a reading of 52.1 in March, while factory orders increased 0.3% (MoM) in February.
On the other hand, the International Monetary Fund (IMF) stated that Portugal was making “good progress” in its loan-supported economic program and approved a €5.2 billion loan to the nation aimed at helping it to curb its high budget deficit.
In the Asian session, at GMT0300, the pair is trading at 1.3156, with the EUR trading 0.10% higher from yesterday’s close.
The pair is expected to find support at 1.3105, and a fall through could take it to the next support level of 1.3054. The pair is expected to find its first resistance at 1.3210, and a rise through could take it to the next resistance level of 1.3263.
Investors are keenly eyeing the release of German industrial production data due later today.
The currency pair is converging with its 20 Hr and trading below its 50 Hr moving average.
