Key Highlights
- The Euro trimmed most of its gains and declined below the 1.1650 support against the US Dollar.
- There was a break below a crucial bullish trend line with support at 1.1730 on the 4-hours chart of EUR/USD.
- The US Personal Income in August 2018 increased 0.3%, less than the forecast of +0.4% (MoM).
- Today, the US ISM Manufacturing Index for Sep 2018 will be released, which is forecasted to decline from 61.3 to 60.5.
EURUSD Technical Analysis
The Euro traded towards the 1.1780-1.1800 resistance this past week against the US Dollar. The EUR/USD pair failed to clear the 1.1800 resistance and started a sharp downside move.
Looking at the 4-hours chart, the pair declined heavily and broke the 1.1720 and 1.1650 support levels. There was even a close below the 1.1650 support and the 100 simple moving average (red, 4-hours).
The downside move was initiated after the pair broke a crucial bullish trend line with support at 1.1730. The decline was such that the Euro spiked below the 1.1600 level and traded towards 1.1560.
At the moment, the pair is consolidating losses with an immediate resistance near the 1.1650 level (the previous support). It also coincides with the 38.2% Fib retracement level of the recent decline from the 1.1797 high to 1.1570 swing low.
Above 1.1650, the next key resistance is at 1.1675 and the 100 simple moving average (red, 4-hours). The most important hurdle for buyers is at 1.1685 and the 50% Fib retracement level of the recent decline from the 1.1797 high to 1.1570 swing low.
On the downside, a break and close below the 1.1560 support will most likely push the pair towards the 1.1520 support in the near term.
Economic Releases to Watch Today
- Germany’s Manufacturing PMI for Sep 2018 – Forecast 53.8, versus 53.7 previous.
- Spanish Manufacturing PMI for Sep 2018 – Forecast 52.5, versus 53.0 previous.
- Euro Zone Manufacturing PMI Sep 2018 – Forecast 53.3, versus 53.3 previous.
- UK Manufacturing PMI for Sep 2018 – Forecast 53.8, versus 52.8 previous.
- US ISM Manufacturing Index for Sep 2018 – Forecast 60.5, versus 61.3 previous.
- US Manufacturing PMI for Sep 2018 – Forecast 55.4, versus 55.6 previous.
