EURUSD Movement
For the 24 hours to 23:00 GMT, EUR traded flat against the USD and closed at 1.2883.
In the Euro-zone, the expectations for an interest rate cut from the European Central Bank (ECB) increased after French unemployment continued to drop in the first quarter of 2013 (Q12013). However, unexpected rise in trade surplus data from the Euro-zone and Italy saved the Euro from slipping into negative territory.
However, news from the US instilled much of the action in the pair after the head of the Federal Reserve Bank of San Francisco, John Williams stated that, the central bank would probably end its bond buying program sometime this year.
In the US economic news, initial jobless claims increased to 360K in the week ending May 10, from a revised 328K claims recorded earlier. Meanwhile, the housing market in the US painted a bleak picture after the number of housing starts dropped to 0.853 million (MoM) in March, from revised 1.021 million recorded in February. However, on a monthly basis, building permits increased slightly more-than-expected to 1.017 million in April, against market expectations for 0.945 million increase. Also, the Federal Reserve Bank of Philadelphia reported that its manufacturing index fell to a reading of -5.2 in May from 1.3 in April.
Soft inflation data in the US took the steam out of the Dollar as well. The nation’s consumer price index fell 0.4% in April from March, worse than expectations for a 0.2% decline.
In the Asian session, at GMT0300, the pair is trading at 1.2862, with the EUR trading 0.16% lower from yesterday’s close.
The pair is expected to find support at 1.2828, and a fall through could take it to the next support level of 1.2795. The pair is expected to find its first resistance at 1.2913, and a rise through could take it to the next resistance level of 1.2965.
The currency pair is trading below its 20 Hr and 50 Hr moving averages.
