EURUSD – Euro Buyers Facing Major Hurdle At 1.125003 October, 2016 by Aayush Jindal in EURUSD, Market Analysis, Technical Analysis
EURUSD – Euro Buyers Facing Major Hurdle At 1.1250
- The Euro started this week with a positive note versus the US Dollar, but faces resistance at 1.1250.
- There is a critical bearish trend line formed on the hourly chart of the EURUSD pair, which is preventing further gains.
- Today, the Euro Zone Manufacturing Purchasing Managers Index (PMI) will be released by the Markit economics, which is forecasted to remain at 54.3 in September 2016.
- In Australia, the AiG performance of the Mfg Index released by the Australian Industry Group came in at 49.8 in September 2016.
EURUSD Technical Analysis
The Euro somehow managed to jump higher against the US Dollar, but seen struggling near a major resistance. The EURUSD pair is finding offers near 1.1250, which is preventing further gains.
There is also a critical bearish trend line formed on the hourly chart around the stated level. The same level acted as a hurdle for the Euro bulls on many occasions earlier as well.
However, a bullish sign is the fact that the pair is above the 100 and 200 simple moving averages on the same chart. So, if there is a break above the highlighted trend line resistance area, more gains are possible.
Euro Zone Manufacturing PMI
Today in the Euro Zone, the Zone Manufacturing Purchasing Managers Index (PMI), which captures business conditions in the manufacturing sector will be released by the Markit economics.
The market is expecting no change from the reading of 54.3 in September 2016. Any better than expected outcome may help the Euro to gain traction in the short term.
Australia’s AiG performance of the Mfg Index
Today, the Australian AiG performance of the Mfg Index, which presents business conditions in the Australian manufacturing sector was released by the Australian Industry Group. The market was expecting a minor increase in September from the last reading of 46.9.
The result was as forecasted, as the AiG performance of the Mfg Index rose to 49.8. However, there was no expansion (50). The report stated that “The stabilization in the Australian PMI® in September was heavily influenced by activity in the food & beverages sub-sector which recovered after contracting in August. This key sector (now contributing around 28% of all manufacturing output) appears to have addressed the factors that drove a contraction in production and sales in August”.
Overall, the Aussie dollar digested the report and was seen trading a few pips higher versus the US Dollar.