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EURUSD: bulls defend range near 55-day SMA

The EURUSD pair logged mild losses on Wednesday, June 23, down 0.09% to 1.1926. The price action climbed to 1.1970 on the back of conflicting data stateside. A broad-based correction in key dollar pairs prompted the bulls to take some profit.

Yesterday’s flash US manufacturing PMI rose to 62.6 in June, overshooting the median estimate that called for 61.5, down from 62.1 in May. By contrast, the services PMI plunged to 64.8 from 70.4 in May. Furthermore, US new home sales unexpectedly slipped in May to their lowest level in 12 months. According to the report, sales fell 5.9% to 769k on an annualized basis, after declining 7.8% to a downwardly revised 817k in April.

Today’s macro agenda (GMT 3)

  • 11:00 Germany: Ifo business climate, current conditions, expectations (June); Eurozone: ECB economic bulletin
  • 14:00 BoE: interest rate decision and QE purchases
  • 15:30 US: GDP (Q3), weekly initial jobless claims, durable goods orders (May), trade balance (May)
  • 23:30 US: bank stress test results

EURUSD: bulls defend range near 55-day SMA

Current outlook

In Asian trading, major currencies have been trading in positive territory, except for the Swiss franc. So far, the FX leaderboard is topped by the aussie and kiwi dollars. Gains in antipodeans imply that risk-on sentiment prevails on today’s market.

As of writing, the euro was trading at 1.1938. The price bounced off the balance line (55-day SMA). Overall, sentiment for the euro remains positive. The price action will need to quickly move up to 1.1957 in order for the bulls to test the 1.1980-1.1990 band by the end of the week. If the euro bounces back to 1.1914 again, the risk of a pullback to 1.1890 will increase.

Today’s highlights include IFO readings out of Germany, and a BoE meeting.

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