EUR/USD muted after German data
The German industrial sector followed the recent poor PMI prints, contracting 1.0% on a monthly basis and 1.0% over the last twelve months. The reaction in the pair was however muted, marching firmly to fresh highs around 1.2860. According to Jane Foley, Strategist at Rabobank, “Early last week the Eurozone peripheral bond markets demonstrated only limited contagion to the worrying political news from Portugal and they remain fairly calm despite talk that the troika could this week decide to delay a payment to Greece. This more self-confident note within EMU suggests a certain degree of EUR resilience lays ahead and this indicates that the pace of any medium-term move lower in EUR/USD is likely to be moderated”.
EUR/USD key levels
At the moment the pair is up 0.36% at 1.2858 with the next resistance at 1.2916 (high Jul.5) ahead of 1.2980 (MA10d) and finally 1.3000 (psychological level). On the flip side, a breakdown of 1.2806 (low Jul.5) would open the door to 1.2796 (low May.17) and then 1.2765 (weekly cloud base).