Technical Analysis

Euro gets a slight lift to start the session on German manufacturing PMI data beat

EUR/USD pares its decline in a slight nudge higher from 1.1804 to 1.1819

For bank trade ideas, check out eFX Plus

The German economy is keeping more resilient in the wake of the second virus wave in Europe, as the manufacturing sector is doing the heavy lifting – helped by export demand – in limiting the downturn that is starting to be seen in the services sector.

The headline manufacturing print is giving the euro a bit of a reason to start moving on the day after having traded more tepidly around 1.1800 against the dollar earlier.

While a 15 pips move isn’t much, just be aware that the nudge higher is seeing buyers start to challenge the 100-hour MA (red line) @ 1.1814.

Keep above that and the near-term bias will turn more bullish instead.

There is also some near-term resistance closer towards 1.1835 before getting towards the highs seen earlier this week nearer to 1.1867-81.

I wouldn’t get too carried away by the positive release, as a worsening virus situation still has the potential to temper with the mood in the manufacturing sector – especially if tighter restrictions are to be called upon in Germany.

It is hard to see how just one bright spot will be able to overwhelm the negative tide moving forward. But for now though, the market is seeing this as a relieving sign after the constant bad news on the virus situation over the past few weeks.

The DAX is also up by around 0.8% on the back of the release:


Articles You May Like

Slippery slope incoming for cable?
AUD/USD continues descend, falls to lowest levels since November last year
ForexLive Americas FX news wrap: US retail sales beat estimates but the market doesn’t care
USD/CAD blows through 1.26 and gets set to challenge April highs and 200-dma
EASY Forex Trading Strategy That’s Great For Beginners (High Win Rate)

Leave a Reply

Your email address will not be published. Required fields are marked *