EURUSD Movement
For the 24 hours to 23:00 GMT, EUR rose 0.35% against the USD and closed at 1.3485. The US Dollar came under pressure as traders refrained from taking major bets ahead of the Senate Banking Committee’s confirmation hearing on Janet Yellen’s Fed-Chairman nomination on Thursday. Investors confidence in the greenback was further hit after the Fed Vice-Chairman, Janet Yellen, stated that the US economy and labour market are performing “far short of their potential” and that “a strong recovery will ultimately enable the Fed to reduce its monetary accommodation and reliance on unconventional policy tools such as asset purchases.”
Meanwhile, industrial production in the Eurozone dropped 0.5% (MoM), worse than expectations of a 0.3% MoM drop. However, positive sentiment for the Euro was fuelled after the European Central Bank Governing Council member and President of Bundesbank, Jens Weidmann, suggested that “government must not lean back and just rely on the effectiveness of low interest rates”, adding that the impact of low interest rates wanes over time and they cannot become permanent.
In the Asian session, at GMT0400, the pair is trading at 1.3468, with the EUR trading 0.13% lower from yesterday’s close.
The pair is expected to find support at 1.3405, and a fall through could take it to the next support level of 1.3343. The pair is expected to find its first resistance at 1.3514, and a rise through could take it to the next resistance level of 1.3561.
Market participants keenly await the release of Euro-zone’s Gross Domestic Product (GDP) data, which is widely expected to show that, on a seasonally adjusted basis, economic growth in the region contracted 0.3% (YoY) in the third quarter, less than a 0.5% contraction witnessed in the preceding quarter. Also later today, the European Central Bank (ECB) is expected to release a monthly report on the prevailing economic situation and the risks to price stability in the region.
The currency pair is trading above its 20 Hr and 50 Hr moving averages.
