• EUR/USD pair gains a modest 0.19% to trade at 1.0792, as US markets remain closed for Labor Day and ECB President Lagarde’s comments fail to stir volatility.
  • Mixed US employment data and a higher manufacturing PMI of 47.6 led to reduced expectations for US interest rate hikes, keeping September odds at 93%.
  • For further directional cues, investors see upcoming economic indicators, including the Eurozone’s S&P Global Services, Composite PMIs, and US Factory Orders.

A quiet session at the beginning of the week saw the Euro (EUR) gaining 0.19% versus the US Dollar (USD), as the US cash markets were closed on a Labor Day holiday. European Central Bank (ECB) officials failed to boost significantly the EUR, as the EUR/USD pair trades at 1.0792, almost flat as Tuesday’s Asian session begins.

EUR/USD Sees Limited Movement as ECB President Stays Mum on Monetary Policy; U.S. Jobs Data and Chinese Stimulus in Focus

During the European session, ECB’s President Christine Lagarde said that decisive action in high inflationary scenarios was “crucial.” Even though she spoke about inflation in a seminar in London, she failed to trigger volatility in the EUR/USD, as Lagarde was muted in talking about the ECB’s current monetary policy.

In the meantime, the additional stimulus the Chinese Government provides on its property markets boosts the economy and improves investors’ mood.

Last week’s US employment data was mixed as the economy added 187K jobs, above estimates and July’s data. Nonetheless, an uptick in the Unemployment Rate, from 3.5% to 3.8% YoY, kept most currency pairs within familiar levels, though spurred a reaction on the US bond market.

Investors slashed their bets of higher interest rates in the United States (US), which is also bad news for the USD. The odds for September’s meeting stay at around 93%, as shown by the CME FedWatch Tool, while the chances for November diminished further. Additionally, the first-rate reduction is projected for May 1, with traders anticipating rate cut odds around 5.14%, 19 basis points lower than the current effective Federal Funds Rate (FFR) of 5.33%.

Other data, depicted by the Institute for Supply Management (ISM), reported that US business activity, as indicated by the manufacturing PMI, scored 47.6, exceeding analysts’ estimates of 47.0 and the previous reading of 46.4.

What to watch?

The Eurozone (EU) economic docket will feature S&P Global Services and Composite PMIs and the Produce Price Index (PIP) by Eurostat. On the US front, the agenda will review Factory Orders.

EUR/USD Technical Levels

EUR/USD

Overview
Today last price 1.0795
Today Daily Change 0.0019
Today Daily Change % 0.18
Today daily open 1.0776
 
Trends
Daily SMA20 1.0888
Daily SMA50 1.0968
Daily SMA100 1.0922
Daily SMA200 1.0816
 
Levels
Previous Daily High 1.0882
Previous Daily Low 1.0772
Previous Weekly High 1.0946
Previous Weekly Low 1.0772
Previous Monthly High 1.1065
Previous Monthly Low 1.0766
Daily Fibonacci 38.2% 1.0814
Daily Fibonacci 61.8% 1.084
Daily Pivot Point S1 1.0738
Daily Pivot Point S2 1.07
Daily Pivot Point S3 1.0629
Daily Pivot Point R1 1.0848
Daily Pivot Point R2 1.092
Daily Pivot Point R3 1.0958

 

 

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