EURUSD Movement
For the 24 hours to 23:00 GMT, the EUR rose 0.06% against the USD and closed at 1.1097, after the Euro-zone’s unemployment rate remained unchanged at 10.0% in September, in line with market expectations and hitting its lowest level in more than five years, thus indicating modest recovery in the region’s jobs market.
Separately, the European Central Bank (ECB), in its economic bulletin report, stated that the Euro-zone economy should continue to expand, albeit at a moderate pace. However, the region faces downside risks, primarily from sluggish global growth and political uncertainty. Further, the bank indicated that comprehensive monetary policy measures taken by the ECB has helped the region’s economy to remain resilient to global economic and political uncertainty.
Macroeconomic data indicated that, the US ISM non-manufacturing PMI eased more-than-expected to a level of 54.8 in October, amid a slowdown in new orders, highlighting that the nation is growing at a moderate pace. Markets expected the index to fall to a level of 56.0, following a reading of 57.1 in the prior month. Additionally, the number of Americans filing for fresh unemployment claims unexpectedly edged up to its highest level in almost three months, after it rose to a level of 265.0K in the week ended 29 October 2016, defying market consensus for a fall to a level of 255.0K and compared to a reading of 258.0K in the previous week. Moreover, the nation’s final durable goods orders fell by 0.3% on a monthly basis in September, compared to a revised advance of 0.3% in the prior month and following a drop of 0.1% in the preliminary print. On the contrary, the nation’s factory orders advanced by 0.3% MoM in September, rising for a third straight month and higher than market expectations for a rise of 0.2%. Factory orders recorded a revised gain of 0.4% in the previous month. Also, the nation’s final Markit services PMI rose to its highest level in eleven-months, after it climbed to a level of 54.8 in October, meeting market expectations and confirming the preliminary estimate. In the previous month, Markit services PMI had recorded a level of 52.3.
In the Asian session, at GMT0400, the pair is trading at 1.1093, with the EUR trading 0.1% lower against the USD from yesterday’s close.
The pair is expected to find support at 1.1058, and a fall through could take it to the next support level of 1.1023. The pair is expected to find its first resistance at 1.1127, and a rise through could take it to the next resistance level of 1.1161.
Moving ahead, investors would look forward to the final Markit services PMI across the Euro-zone for October, slated to release in a few hours. Moreover, in the US, unemployment rate and change in non-farm payroll data, both for October along with the nation’s trade balance for September, due to release later in the day, would pique investor attention.
The currency pair is showing convergence with its 20 Hr and 50 Hr moving averages.
