EUR/USD analysis: growth picks up in Q4
|EUR/USD Current price: 1.0878
The American dollar started the week moderately pressured against its major rivals, but changed course and recouped the ground lost early in the US session, following the release of a better-than-expected October preliminary manufacturing PMI. According to the report, US manufacturers recorded the strongest upturn in business conditions for 12 months, as the PMI rose from 51.5 to 53.2. Europe also seems to have started the fourth quarter in a strong fashion, as the EU composite PMI for October jumped from 52.6 to 53.7, the highest reading this year. In the EU, growth was boosted by a sharp advance in German figures, with only the French services PMI falling below expected, down to a 3-month low of 52.1. Still, the imbalance between Central Banks' economic policies, weighed mode, preventing the common currency from advancing.
The EUR/USD pair closed the day flat around 1.0880, having met selling interest on an advance up to the 1.0900 level, retaining the bearish tone seen on previous updates. Technically, the 4 hours chart shows that the price is well below a bearish 20 SMA, currently at 1.0910, the immediate resistance and the level to surpass to see the pair attempting an upward extension. In the same chart, the Momentum indicator heads higher within bearish territory, but the RSI indicator has turned back south around 33 after correcting extreme oversold readings, in line with further slides, particularly on a break below 1.0840, a strong static long term support.
Support levels: 1.0840 1.0800 1.0760
Resistance levels: 1.0910 1.0950 1.1010
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