The French industrial production came in better than expected, by +1.5% in August (consensus of -0.2%). The same happened in Italy, rising by +1.7% on the month instead of contracting by -0.4%. The annualized industrial production in Italy surprised by narrowing its contraction from -7.2% to -5.2%, while consensus was pointing to -10.1% in August. In Greece, the annualized industrial production shifted from -4% to +2%.
Since the pair dropped yesterday to erode the 6 week uptrend, attention is now on key short term support at 1.2823/1.2750 (the 200 day moving average and the 3 month uptrend). “Technical indicators are starting to turn more negative, failure to hold 1.2750 would see the market under increasing downside pressure to sell off to 1.2605 then 1.2472, the 50% and 61.8% retracements of the move seen since July”, wrote analyst Karen Jones.