Today we direct our attention to one of the world’s most popular trading pairs, the EUR/USD. We can expect that the pair will move with some volatility these days because there are many economic reports being released this week regarding both pairs. As usual, news about the economic climate in Europe and the United States can dramatically influence how strong these currencies would be.
On the one hand, from Europe we expect a Financial Stability Review by the European Central Bank, a services and manufacturing PMIs; we’d also be receiving a bunch of reports from Germany - again services and manufacturing PMIs, but also information about the GDP. France, which recently brought new strength to the euro by electing a pro-EU president, will too release some data such as services and manufacturing PMIs. Both reports from the ECB and from separate European countries are important to evaluate the overall situation of the euro.
On the other hand, the United States will be publishing many similar reports regarding manufacturing, services, and new home sales. These are particularly important since the Fed expressed a concern that inflation is not as high as expected, which could delay the long-expected rate hike in June.
On the daily chart watch out for the pair overcoming the resistance levels at 1.1273 and 1.1284 (the breakout buy lies just above at 1.1290). If the pair drops, it could flirt with the support levels at 1.1199 and 1.1188, just above the breakout sell at 1.1182.
At the moment of the publication of this article the EUR/USD is trading around 1.1255. Some indicators show buy signals, while others are neutral.
