EURUSD Movement
For the 24 hours to 23:00 GMT, EUR rose 0.62% against the USD and closed at 1.2923, as risk appetite improved among investors following the release of upbeat US jobless and housing data. Moreover, positive Euro-zone PMI data also added to the optimism.
Also, the European Central Bank (ECB) President, Mario Draghi, stated that the Euro-zone is more stable than a year earlier but economic conditions still remain challenging and governments should make efforts via reforms and banking union plans to further stabilize the economic system. Meanwhile, ECB’s Governing Council member, Christian Noyer stated that the central bank is currently considering the possible introduction of additional monetary instruments in order to tackle differences in financing conditions across the Euro-zone.
In the US economic news, initial jobless claims for state employment benefits dropped by 23K to a seasonally adjusted 340K in the week ended 18 May 2013. Also, the Markit manufacturing purchasing managers’ index (PMI) fell less than expected to a reading of 51.9 in May. Separately, house price index (HPI) climbed 1.3% in March, more than the expected 0.8% rise.
Among the PMI data released in Europe yesterday, manufacturing and services PMI in the Europe came in above market expectations, whereas in Germany manufacturing PMI surpassed market forecasts while the services PMI recorded a lower than expected rise in May.
In the Asian session, at GMT0300, the pair is trading at 1.2922, with the EUR trading marginally lower from yesterday’s close.
The pair is expected to find support at 1.2843, and a fall through could take it to the next support level of 1.2763. The pair is expected to find its first resistance at 1.2980, and a rise through could take it to the next resistance level of 1.3037.
Later today, GDP data slated for release in Germany is awaited by investors, while Spain is to release its PPI data.
The currency pair is showing convergence with its 20 Hr moving average and is trading above its 50 Hr moving average.
