The EUR/USD pair extended its post-FED decline down to 1.0941, from where its currently recovering after the Eurozone Economic Sentiment Indicator rose to 104.0 in July, beating 103.3 consensus. Earlier in the day, news were less encouraging as German unemployment unexpectedly rose in July, posting its biggest increase since May last year. Unemployment rose by 9,000 against expectations of a 5,000 decline.
Later on in the day, the US will release its second quarter advanced GDP figures, the main event of the day. The US is expected to have grown 2.6% compared to the final reading of the Q1 of -0.2%. Expectations of accelerating growth are based on increased consumer spending, and the strong readings in the housing sector, as despite missing expectations lately, the figures remain near multi-years highs.
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Technically, the 4 hours chart for the EUR/USD pair shows that the price is well below its 20 SMA, although the technical indicators are aiming higher below their mid-lines, limiting at the moment, the chances of a new leg south. Nevertheless, as long as the price remains below 1.1000 the upside is well limited, with a break below the mentioned daily low exposing the pair to a steady decline towards the 1.0880 price zone, particularly if the US GDP results as strong as expected or better.
A recovery above 1.1000 on the other hand, should lead to an upward continuation towards the next intraday resistance, located around 1.1050.
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