EUR/USD weaker, tumbles to 2-month low near 1.1400

The shared currency comes under further selling pressure on Wednesday.
Spot comes down and tests fresh lows in the boundaries of 1.1400.
EMU, German flash PMIs came in below expectations in October.

Pablo Piovano FXStreet

The selling pressure is now gathering further steam around the single currency, dragging EUR/USD to fresh 2-month lows in the 1.1400 neighbourhood.

EUR/USD vulnerable on Italy, data

The pair is down for the second week in a row so far today, tumbling to fresh lows and challenging at the same time the critical 1.1400 handle, levels last seen in mid/late-August.

Italy remains the exclusive source of the ongoing and intensified selling mood around the pair, particularly after the EU rejected on Tuesday the proposed 2019 draft budget, sparking further accusations between the parties.

In addition, advanced manufacturing PMIs for the current month in Germany and the euro bloc are seen below expectations, also collaborating with the sour sentiment around EUR.

Still in the euro docket, ECB’s Private Sector Loans expanded at an annualized 3.1% and M3 Money Supply expanded 3.5% on a year to September.

In the US data space, September’s New Home Sales and flash manufacturing and services PMIs for the month of October are next on tap ahead of the weekly report on US crude oil supplies by the DoE.

EUR/USD levels to watch

At the moment, the pair is losing 0.59% at 1.1405 and a break below 1.1402 (low Oct.24) would target 1.1319 (200-week SMA) en route to 1.1299 (2018 low Aug.15). On the upside, the next resistance emerges at 1.1508 (low May 29) seconded by 1.1550 (high Oct.22) and then 1.1574 (55-day SMA).

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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