EUR/USD analysis: EU PMIs and FOMC Minutes in the eye of the storm

Valeria Bednarik FXStreet

EUR/USD Current price: 1.0620

It was a dull start to the week with the US on holiday's due to the Presidents day, and a light macroeconomic calendar in Asia and the EU. The EUR/USD pair held above the 1.0600 level, but at the same time traded as high as 1.0632, as political concerns undermine the common currency. In the data front, Germany released its January Producer Price index, which resulted up for the month by 0.7%, above an expected 0.2%, while compared to a year earlier, prices at factory levels rose by 2.4%, above previous 1.0% and market's forecast of 1.9%. Preliminary consumer confidence for February in the EU fell by more than expected, with the index down to -6-2 from a previously revised -4.8. Things will get more interesting staring this Tuesday, with the release of European PMIs, and further on Wednesday, with the latest FOMC's Minutes.

From a technical point of view the pair has made little progress over the last 24 hours, maintaining a bearish, stance despite the sharp bounce from 1.0520 from last week. In the 4 hours chart, the price has been unable to advance beyond a bullish 20 SMA, whilst the Momentum indicator heads south below its 100 level and the RSI consolidates around 47, this last reflecting the limited intraday volume. A break below 1.0590 is required to confirm a bearish extension towards the 1.0560 region first, followed later by the mentioned low at 1.0520.

Support levels: 1.0590 1.0565 1.0520

Resistance levels: 1.0650 1.0680 1.0720

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Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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