Volatile day faced by the Euro on Tuesday with the currency falling 50 pips during the European/London session then rising back up 50 pips during the U.S session. Although fundamentals point for a weak Euro during the whole week, the Single currency was able to aggressively reject the 1.15305 support level. Additionally, U.S Dollar bulls were not able to make the best out of the better than expected ISM Manufacturing PMI release (61.3 versus 57.6) since the strength from the U.S Dollar side was blocked by a wall of Euro bulls at 1.15305. In addition to any developments in the trade war between the U.S and China, and updates with the performance of emerging market economies, investors should keep their eye on today's release of the Services PMI and Retail Sales figures from the euro-zone.
The bearish bias continues as the pair remains to trade below the three major moving averages. The chart below shows a clear rejection of the 200-period moving average indicating a broad bearish bias in the long term direction of the pair. Adding to the bearish momentum, the 13-period moving average has crossed below the 200-period moving average. Finally, the recent break of the 1.15833 minor support level will pave the way for a drop towards 1.15430.
Support: 1.15833 1.15430
Resistance: 1.16428 1.17528