Euro Extends Its Gains Following Upbeat PMI Numbers From The Euro-Zone
GCI Financial | Jul 25, 2014 03:32AM ET
For the 24 hours to 23:00 GMT, the EUR marginally rose against the USD and closed at 1.3464, following upbeat PMI numbers from across the Euro-zone. The manufacturing activity of German expanded to a level of 52.9 in July, from previous month’s level of 52.0, while the nation’s services activity rose at the fastest pace in three years to 56.6 in July, as compared to a level of 54.6 reported in the previous month. Additionally, the PMI data of the Euro-zone too registered an unexpected rise in July. Moreover, the unemployment rate in Spain dropped faster than expected to its lowest level in two years in the second quarter.
The gains for the common currency however were limited as EU officials mulled over further sanctions on Russia, in order to punish the country for its support of separatists in Ukraine.
The US Dollar lost ground after data revealed that the manufacturing activity in the world’s largest economy has decelerated to a reading of 56.3 in July, as compared to a reading of 57.3 registered in the prior month. Meanwhile, other data indicated that the sales of US single-family homes fell to its lowest level since July 2013. However, the greenback nudged higher after the weekly jobless claims in the US fell by 19,000 to a seasonally adjusted 284,000 in the week ended July 19, the lowest level since 2006. Moreover, the Kansas Fed manufacturing activity surged to a level of 11.0 in July, as compared to a level of 2.0 posted in June.
In the Asian session, at GMT0300, the pair is trading at 1.3467, with the EUR trading tad higher from yesterday’s close.
The pair is expected to find support at 1.3441, and a fall through could take it to the next support level of 1.3416. The pair is expected to find its first resistance at 1.3489, and a rise through could take it to the next resistance level of 1.3512.
Trading trends in the Euro today are expected to be determined by IFO sentiment indices and Gfk consumer confidence reading from Germany. Meanwhile, the release of durable goods orders from the US would also keep investors on toes.
The currency pair is showing convergence with its 20 Hr and 50 Hr moving averages.
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