EUR/USD challenges multi-day lows near 1.0930 post-data

EUR/USD extends the weekly downside to the 1.0930 region.
German Retail Sales expanded 1.2% MoM during February.
Manufacturing/Services PMIs in the euro area came in mixed.

Pablo Piovano FXStreet

The downbeat sentiment in the shared currency stays well and sound for yet another session, dragging EUR/USD to weekly lows in the 1.0930 zone.

EUR/USD now looks to US data

EUR/USD is down for the third consecutive session so far on Wednesday and is flirting with a Fibo retracement of the March drop in the 1.0960 area.

The resumption of the upside momentum in the greenback is putting the pair under extra pressure in the area of multi-day lows, despite the Federal Reserve announced another measure to ease concerns on the funding front on Tuesday, all aimed to fight the COVID-19 fallout.

In the docket, better-than-expected German Retail Sales passed unnoticed among traders earlier in the session, while final PMIs in the euro area came in on a mixed tone.

Across the pond, the Manufacturing ISM will grab all the attention later in the session.

What to look for around EUR

The rally in EUR/USD appears to have met some interesting hurdle in the vicinity 1.1150 so far, sparking some corrective downside in consequence. In the meantime, dynamics around the greenback plus developments from the COVID-19 are expected to keep ruling the price action in the pair. On the macro view, recent better-than-forecasted PMIs in both Germany and the broader Euroland opened the door to some respite in the prevailing downtrend in fundamentals in the region, although the underlying stance still remains well on the negative side and aggravated by recession fears in response to the COVID-19 fallout as well as the probability of the re-emergence of disinflationary trends.

EUR/USD levels to watch

At the moment, the pair is losing 0.80% at 1.0941 and faces the next support at 1.0814 (78.6% Fibo of the 2017-2018 rally) followed by 1.0777 (monthly low Feb.20) and finally 1.0635 (2020 low Mar.23). On the flip side, a break above 1.1077 (200-day SMA) would target 1.1147 (weekly high Mar.27) en route to 1.1186 (61.8% Fibo of the 2017-2018 rally).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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