EUR/USD Forecast: data boost EUR's demand
|The EUR/USD pair got a boost early Europe, jumping to a daily high of 1.1793, following the release of the region preliminary August Markit PMIs and words from ECB's Draghi, who spoke at the Lindau Meeting on Economic Sciences, in Germany. Despite he didn't comment specifically on the Central Bank's economic policy, he said that central banks need to be prepare to face new challenges, defending QE.
Up beat Markit PMIs, however, led the way higher for the common currency, as the manufacturing sector grew by more than expected according to preliminary estimates, while the services sector remains firm in expansion territory, despite the EU services manufacturing PMI came in at 54.9, below expected and previous 55.4. According to the official release, the headline Markit Eurozone PMI posted 55.8 in August, up fractionally from July’s reading of 55.7, with the rate of expansion remaining around the best seen over the past six years.
The US calendar will be quite busy too, with Fed's Kaplan speaking ahead of Wall Street's opening, followed later by the release of the US Markit PMIs and New Home sales for July.
In the meantime, the pair hovers near the mentioned high, trapped within a familiar range, and neutral short term, with the scale slightly lean towards the upside, given that in the 4 hours chart, technical indicators have bounced from their mid-lines, and head north, whilst the price surpassed its 20 and 100 SMAs that anyway remain horizontal and within a tight range.
Short term selling interest stands in the 1.1820/30 region, while the next intraday resistance comes at 1.1860. It would take a break above this last to confirm a bullish extension up to 1.1909, the yearly high posted earlier this month.
To the downside, the pair has an immediate support around 1.1730, followed by the 1.1680/90 price zone, where buyers await.
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