EURUSD Movement
On Friday, EUR declined 0.09% against the USD and closed at 1.3521, as a dismal Euro-zone’s consumer confidence data spooked investors’ sentiment. Data showed that consumer confidence in the Euro-zone region rose to a level of -14.9 in September, less than analysts’ expectation for a rise to -14.5 reading and compared to a reading of -16.0 registered in the previous month.
Elsewhere, in the US, St. Louis Fed President, James Bullard, in his speech, stated that weakness in domestic economic data led the Fed policymakers to adopt a borderline decision to refrain from tapering its $85 billion asset purchase programme. He also highlighted the possibility of the Fed to make a small cut to its bond purchases programme in its upcoming October policy meeting.
In the Asian session, at GMT0300, the pair is trading at 1.3528, with the EUR trading marginally higher from Friday’s close. Earlier today, media reports indicated that Chancellor, Angela Merkel’s conservative party won Germany’s election, putting her on course for the biggest election tally since 1990. However, her party may need support from centre-left rivals to form a new government after her coalition partner crashed out of Parliament. Traders speculated that a new coalition probably won’t result in any major shifts in German political arena, though it could bring a slightly softer tone to managing the Euro-crisis.
The pair is expected to find support at 1.3501, and a fall through could take it to the next support level of 1.3473. The pair is expected to find its first resistance at 1.3553, and a rise through could take it to the next resistance level of 1.3577.
Investors await the release of Markit manufacturing and service PMI data for the Euro-zone, due later today. Traders are also expected to keep a close watch on the European Central Bank (ECB) President, Mario Draghi’s speech in the European Parliament, commencing later during the day.
The currency pair is showing convergence with its 20 Hr and 50 Hr moving averages.
