Tuesday, April 2, 2019

EUR/USD - 02 April 2019

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Fundamental Highlights

The Euro closed negatively on Monday as more signs of economic slowdown emerged. EU March inflation was slightly below expectations, up by 1.4% YoY vs 1.5%. Core CPI printed 0.8%, missing the market's forecast of 0.9%. Also, Manufacturing PMI for the same month suffered downward revisions, with the German index down to 44.1, its lowest since mid-2012. For the whole EU, the manufacturing index was down to 47.5. The same with the US, Manufacturing PMI suffered a strong downward revision, from 52.6 to 50.5, but the official ISM index surged to 55.3 surpassing the expected 54. Also, Construction Spending rose by 1.0% in February, surpassing the market's expectations. Dollar's rally, however, was contained by poor February Retail Sales, which unexpectedly fell by 0.2% MoM. Today, traders will be waiting for the EU to release February PPI and the US to release Durable Goods Orders for the same month.

Technical Analysis

The Euro broke below 1.1220 to find support at 1.12 (S1), as the bearish momentum continues on this pair. A break below 1.12 (S1) will open doors for further weakness towards 1.1175 (S2). If, however, price breaks above 1.1220 (R1), then we could likely see a push towards 1.1250 (R2).

Support: 1.12 / 1.1175
Resistance: 1.1220 / 1.1250

Chart (H4)