EUR/USD drops to 1.3850 on EMU data

Pablo Piovano FXStreet

FXStreet (Edinburgh) - The single currency is now reverting the early upside, dragging the EUR/USD back to the 1.3850 area after softer EMU releases.

EUR/USD deflates on data

The pair is now giving away some gains after EMU’s M3 Money Supply expanded below estimates at an annual pace of 1.1% during March vs. 1.4% forecasted and February’s 1.3%. Private Loans followed suit, contracting 2.2% in a year to March, missing forecasts for a 2.1% contraction. Previous releases showed the German Consumer Confidence gauged by the Gfk Survey matching estimates at 8.5 for the month of May. “Looking at the latest money and credit growth data there remains a compelling case for further monetary easing by the ECB. However, with inflation expected to bounce this month and economic activity continuing to recover, we suspect that the ECB will stick to its strategy of verbal intervention at next week’s press conference and refrain from taking further policy action”, commented Martin van Vliet, Analyst at ING Bank NV.

EUR/USD levels to watch

As of writing the pair is up 0.05% at 1.3858 with the next resistance at 1.3880 (high Apr.28) ahead of 1.3906 (high Apr.11) and then 1.3925 (high Mar.19). On the flip side a breakdown of 1.3832 (daily cloud top) would aim for 1.3824 (10-d MA) and finally 1.3815 (low Apr.28).

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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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