Breaking: EUR/USD collapses below 1.10 on poor German PMIs

Yohay Elam FXStreet

Markit's forward-looking Purchasing Managers' Indexes are pointing to an outright recession in Germany.

The Manufacturing PMI hit a low of 41.4 points, significantly below 43.5 points in August and well below expectations for an increase. The industrial sector in the continent's largest economy is critical. The services sector – which has been carrying the economy forward – is also down with only 51.6 points – barely above the 50-point threshold that separates expansion from contraction.

The continent's locomotive is derailing. Earlier, French PMIs also missed forecasts and dropped closer to 50. The all-European figures are due out shortly.

EUR/USD has reacted with a fall to 1.0969 and the move continues. Support is seen at 1.0950 and it is followed by the 2019 low of 1.0926 – which is also a double-bottom. Resistance awaits at 1.10, followed by 1.1025.

Here is how the move looks on the four-hour chart:

More EUR/USD path of least resistance is down as Q3 draws to a close – Confluence Detector

Author

Yohay Elam

FXStreet

Yohay is in Forex since 2008 when he founded Forex Crunch, a blog crafted in his free time that turned into a fully-fledged currency website later sold to Finixio.

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