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Weak statistics from Europe increased pressure on the EUR / USD pair

Sep 23 2019, 04:15 PM (BDT) | Fortfs.com

The EUR / USD pair is trading lower on Monday by more than 0.4%, reacting to the publication of weak statistics from Europe.

According to the report, the PMI of the manufacturing sector in Germany fell from 43.5 to 41.4 points, while experts expected to see an increase to 44.0 points. The service sector PMI fell from 54.8 to 52.5 points. The forecast was at the level of 54.3 points. Lower than market expectations were data on economic activity in France.

Weak statistics reinforce investors' concerns about the prospects for the development of the EU economy and reduce interest in the European currency.

Against the background of published statistics on Germany, much investor attention today will be riveted to the Bundesbank's monthly report. But the main event of the day, most likely, will be the speech of the ECB President Mario Draghi in Brussels.

In the US today, the publication of preliminary data on PMI in the manufacturing and services sectors is also expected. Experts predict an increase in indicators, which may strengthen the position of the dollar against the European currency.

On the chart, there was a price exit from the range 1.0990-1.1085. The currency pair broke through the lower boundary of the horizontal channel, indicating the priority of the downward vector. The next target for bears is the annual minimum in the region of the level of 1.0925.

Resistance levels: 1.1020, 1.1085, 1.1100.

Support levels: 1.0915, 1.0890, 1.0850.

The main scenario is a decline to 1.0925.

An alternative scenario is a return to the level of 1.0990 and an increase to 1.1020.

A negative news background locally prevails on the market. Inside the day, we give preference to shorts, which should be considered when the price rolls back in the region of the level of 1.1020. 

 

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