EURUSD Movement
For the 24 hours to 23:00 GMT, EUR declined 0.22% against the USD and closed at 1.3071, as weak Euro-zone economic data and a lack luster Spanish bond auction weighed on the common currency.
On the economic front, retail sales in the Euro-zone fell 1.2% (MoM) in October, against the forecast for a 0.2% drop and compared to a 0.6% fall recorded in the previous month. Meanwhile, though the services PMI in the Euro-zone, Germany and France rose for the month of November, the reading remained below 50, suggesting that the European bloc may struggle to pull out of a recession as governments toughen spending cuts to fight the sovereign-debt crisis.
Additionally, in a bond auction, Spain raised €4.3 billion at an auction of government debt, falling short of the target of €4.5 billion.
In the US economic news, the Mortgage Bankers Association (MBA) indicated that for the week ended 30 November 2012, mortgage application volume, on a seasonally adjusted basis, rose 4.5% from one week earlier. Meanwhile, the Commerce Department reported that the seasonally adjusted factory orders increased 0.8% (MoM) in October, following a downwardly revised 4.5% increase recorded in September. The Institute for Supply Management (ISM) reported that its non-manufacturing index rose to a reading of 54.7 in November, from a reading of 54.2 recorded in October.
In the Asian session, at GMT0400, the pair is trading at 1.3057, with the EUR trading 0.11% lower from yesterday’s close, as Standard & Poor’s cut its sovereign long-term foreign currency credit rating on Greece to “Selective Default” from “CCC”.
The pair is expected to find support at 1.3026, and a fall through could take it to the next support level of 1.2994. The pair is expected to find its first resistance at 1.3108, and a rise through could take it to the next resistance level of 1.3158.
Investors keenly look forward to the Euro-zone GDP data scheduled to be released later today. Germany’s factory orders, the French ILO unemployment data and the initial jobless claims and the continuing jobless claims data in the US are also awaited.
The currency pair is trading below its 20 Hr and 50 Hr moving averages.
