News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
EUR/USD Pivots at Last Week’s Low - Surprise PMIs End EZ Data Drought

EUR/USD Pivots at Last Week’s Low - Surprise PMIs End EZ Data Drought

Christopher Vecchio, CFA, Senior Strategist

Talking Points:

- EURUSD finds support near lows from last week.

- EURGBP might be setting a series of higher lows.

- Euro Faces Economic Headwinds with Weakening German, Euro-Zone PMIs

The Euro has been dogged by weak economic data over the past several months, with the Citi Economic Surprise Index having closed last week at -54.1, barely off the yearly low established on October 14 at -57.3. Yet the bevy of today's data releases has served to provoke optimism for the Euro.

The better than expected German PMI data has helped EURUSD find support in the area carved out by last week's lows, and the downtrend seen on intraday charts this week (H1, H4 timeframes) has started to break.

The same technical development can be noted in EURGBP after this morning's mix of better Euro-Zone data and weaker UK data. EURGBP has set a series of higher lows on lower timeframes; and though in the middle of its down channel, we're mindful that a reversal through £0.8065 could mark a significant bottom.

The fuel here, of course, is the stretched futures market positioning. Non-commercials/specs held 155.3K net-short contracts for the week ended October 14, an increase from the 146.2K net-short contracts held a week earlier. Still, market positioning is off its extreme seen in early-September, when specs held 161.4K net-short contracts.

Read more: USDOLLAR at Key Resistance - Reaction to Provoke EUR/USD, AUD/USD

--- Written by Christopher Vecchio, Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher’s e-mail distribution list, please fill out this form

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES