EURUSD Movement
For the 24 hours to 23:00 GMT, EUR rose marginally against the USD and closed at 1.3180. The greenback saw a drop in demand amid soft US economic figures. Moreover, the Federal Reserve concluded its monetary policy meeting making no change to interest rates or stimulus programs.
In its statement following a two-day meeting, the Fed indicated that it will continue to buy $85 billion worth of bonds each month to support a moderately expanding economy that continues to have a high unemployment rate. Also, the Fed kept its benchmark interest rate unchanged at 0.25%, in line with expectations.
On the US economic front, the Institute for Supply Management reported that its manufacturing purchasing managers’ index fell to 50.7 in April, worse than the expected drop to 50.9, while Markit Economics reported that the final manufacturing PMI was revised higher to a reading of 52.1 in April, its lowest reading in six months, compared to a reading of 54.6 in March. Construction spending also dropped unexpectedly in March. Private sector employment increased by 119.00K in April, much lower than the expected increase of 150.00K. Separately, mortgage applications volume rose 1.8% in the week ended 26th April 2013.
In the Asian session, at GMT0300, the pair is trading at 1.3169, with the EUR trading marginally lower from yesterday’s close.
The pair is expected to find support at 1.3137, and a fall through could take it to the next support level of 1.3106. The pair is expected to find its first resistance at 1.3222, and a rise through could take it to the next resistance level of 1.3276.
Later today, manufacturing PMI is due for release in Germany, France and the Euro-zone. Traders also await the ECB interest rate decision ahead in the day that shall give direction to the pair. Meanwhile, in the US, investors forecast a decline in trade deficit, whereas initial jobless claims are expected to record a rise.
The currency pair is trading between its 20 Hr and 50 Hr moving averages.
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