The Euro gained ground on Wednesday after better than expected growth related news came out from China and the EU, while a poor US ISM Non-Manufacturing PMI dented the Dollar’s bullish sentiment. Markit Services PMI for the different countries and for the whole EU came better than previous estimates. European Retail Sales surpassed the market’s forecast, up in February 0.4% MoM and 2.8% YoY. In the US, the ADP survey showed that the private sector added 129,000 new jobs in March, well below the 170K expected. Also, the ISM Non-Manufacturing PMI missed the market's forecast, down to 56.1 in March from 59.7 in February. Looking ahead, Germany will release February Factory Orders today while the US will unveil the Initial Jobless claims. Also, the ECB will publish the Minutes of its latest monetary policy meeting, although this is not expected to surprise.
The Euro broke above 1.1225 resistance (previous support) and went on to retest 1.1250 (R1) which is also the 50-day moving average. Price is currently trading just below this resistance area, looking for either a break to the upside to retest 1.1280 (R2) or a pullback towards 1.1225 (S1) or possibly even lower, keeping in mind that the short-term trend is still very bearish.
Support: 1.1225 / 1.12
Resistance: 1.1250 / 1.1280