EURUSD Movement
For the 24 hours to 23:00 GMT, the EUR declined 0.64% against the USD and closed at 1.1330 on Friday, amid sharp decline in the PMI data.
Data indicated that the Euro-zone’s preliminary manufacturing PMI unexpectedly declined to a 30-month low level of 51.5 in November, compared to a level of 52.0 in the previous month. Market participants had expected for the PMI to record a flat reading. Moreover, the region’s flash services PMI eased to its lowest level in 25-months of 53.1 in November, compared to market consensus for a drop to a level of 53.6. In the prior month, the PMI had registered a reading of 53.7.
Separately, in Germany, the seasonally adjusted final gross domestic product (GDP) retreated 0.2% on quarterly basis in 3Q 2018, confirming the preliminary print and in line with market expectations. In the preceding quarter, the GDP had recorded a rise of 0.5%. Also, the nation’s preliminary manufacturing PMI surprisingly slid to a level of 51.6 in November, compared to a reading of 52.2 in the preceding month. Market had envisaged for the PMI to remain unchanged. Additionally, the flash services PMI fell to a four-year low level of 53.3 in November, amid sluggish productions in factories and more than market anticipation for a drop to a level of 54.5. In the prior month, the PMI had registered a reading of 54.7.
The US dollar gained ground against basket of currencies, amid worries over global economic slowdown and as US-Sino trade war reduced the looming uncertainties.
In the US, data showed that the US preliminary Markit manufacturing PMI unexpectedly fell to a level of 55.4 November, defying market expectations for an unchanged reading. In the previous month, the PMI had recorded a level of 55.7. Meanwhile, the nation’s preliminary Markit services PMI surprisingly slid to a level of 54.4 in November, defying market anticipation for a rise to 55.0. In the prior month, the PMI had registered a reading of 54.8.
In the Asian session, at GMT0400, the pair is trading at 1.1340, with the EUR trading 0.09% higher against the USD from Friday’s close.
The pair is expected to find support at 1.1304, and a fall through could take it to the next support level of 1.1269. The pair is expected to find its first resistance at 1.1398, and a rise through could take it to the next resistance level of 1.1457.
Moving ahead, traders would await Germany’s IFO business climate and expectations, both for November, set to release in a few hours. Later in the day, the US Chicago Fed national activity index for October and Dallas Fed manufacturing activity for November, will be on investors’ radar.
The currency pair is trading below its 20 Hr and 50 Hr moving averages.
