EURUSD is unchanged after euro zone PMI reports came in mixed earlier in today’s European session. As of this trading, the currency pair is hovering around its Asian session highs at 1.0825.
While all reports came in below the 50.0 baseline which indicates expansion, the manufacturing sector across the euro zone seems to be faring better than the services industry. France’s manufacturing PMI for March came in higher at 42.9 than the 39.4 forecast. Meanwhile, Germany’s version of the report printed at 45.7, better than the 40.1 estimate. The euro zone-wide manufacturing PMI also beat the 40.1 estimate when it came in at 44.8.
On the contrary, three versions of the services PMIs missed expectations. The French services PMI was below the 39.6 consensus at 29.0. As for Germany, the PMI printed at 34.5 versus the 43.0 forecast. The euro zone version of the report clocked in at 28.4, much lower than the forecast at 40.0.
Another interesting observation is that these reports do not reflect the same severity that the coronavirus pandemic had on Chinese PMIs. Therefore, these numbers could soon be enough to inspire a rally on EURUSD.
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On the hourly time frame, EURUSD looks to have formed an inverse head and shoulders. This is characterized by lower lows succeeded by higher lows. As of this writing, the currency pair is trading around neckline resistance. If buyers can sustain their momentum, we could soon see EURUSD trade higher to near-term resistance around 1.0910. This price coincides with the falling trend line when you connect the highs of March 9, March 16, and March 17.
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Alternatively, if sellers dominate trading, a close below 1.0773 could mean that EURUSD may soon retest this week’s lows at 1.0650.More content
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