Euro Latest: EUR/USD Upside Faces Tough Resistance, PMIs Mixed
EUR/USD Price Analysis & News
PMI RECAP: French PMI’s printed slightly below expectations. However, the data signals strong back to back monthly growth in output with the French economy enjoying its best quarterly performance since the beginning of 2018, according to IHS Markit. Elsewhere, inflationary pressures continued to pick up as prices paid rose to their strongest pace in nearly a decade.
German PMI’s posted a big beat vs expectations, thanks to the re-opening effects of the German economy. In turn, the composite rose to its highest level since March 2011. Similar to the French PMI, average prices charged for goods and services accelerated to record levels.
Euro Area PMIs:
EUR/USD: While German PMI’s has taken the pair back to intra-day highs, there are hurdles ahead for further upside. As I stated on Monday, resistance is situated at 1.1950 and 1.1990 which are likely areas where traders will attempt to fade gains. A stabilisation in risk sentiment and a plethora of Fed members reiterating that substantial progress is still needed highlights the fact that much of last week’s USD surge had been fuelled by an unwind of USD short positioning. That being said, today’s PMIs are unlikely to alter the outlook for EUR/USD with the narrative surrounding Fed-ECB policy divergence likely to become a key driver.
EUR/USD Chart: Daily Time Frame
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.