The European currency was weighed down during yesterday’s session after a weaker German Manufacturing PMI contracted for the 7th straight month. The broad greenback strength added additional downside pressure on the common currency, as July’s FOMC meeting is getting closer and closer. Today, the ECB will have its own monetary policy statement, if Draghi sends out a strong dovish signal and hints a September rate cut, the Single currency could take a beating and drop below 1.11 towards 1.10 in the next few days. Additionally, the EU will also release the German lfo Business Climate and the US in its turn will publish June’s Core Durable Goods Orders, but traders’ main focus will be the ECB monetary policy decision.
The Single currency bears are eyeing to retest at least 1.11 in today’s session, as price action is getting weaker by the minute. The bulls attempted to break above 1.1150 yesterday but they lacked momentum and the sellers regained control. If the bears were able to break below the 1.11 yearly low today, then 1.1050 will be exposed for a retest. However, the bulls will need at least to take out 1.1150 to halt this current heavy selling.
Support: 1.1107 / 1.1050
Resistance: 1.1150 / 1.1185