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German PMI preview: What to expect of EUR/USD?

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Dec 16, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Mumbai) - The EUR/USD pair remains capped below 1.0950 heading into early Europe, stalling its recovery from lows stuck ahead of 1.09 handle on Tuesday. The major treads water as traders remain on the side-lines ahead of the main risk-event for this month – the Fed rate hike decision due to be announced later today.

    In the meantime, the economic data next in focus is the German flash manufacturing and services PMIs lined up for release at 08.30GMT

    Will the new exports orders and employment sustain at higher levels?

    The headline manufacturing PMI figure is expected to register a slightly lower 52.7 result compared to the final 52.9 figure recorded in November. While the index for the services sector is projected to show a small downtick to 55.5 from 55.6 recorded in the previous month.

    In the flash PMI report, it remains to be seen if the new export orders sustain at three-month highs or turn lower on the back waning overseas demand in wake of increased concerns over global economy, given the recent rout in oil prices.

    The data is expected to have virtually no impact on the EUR/USD pair as the Fed decision is expected to remain the main driver for today.

    EUR/USD Technical Levels

    At 1.0944, the immediate resistance is seen at 1.0966/68 (daily pivot/ 5-DMA). A break beyond the last, doors will open for a test of 1.1000 (round number) and above that at 1.1029/33 (Dec 10 & 11 High). On the flip side, the immediate support is placed at 1.0903/00 (Dec 15 Low/ psychological levels), below which 1.0877 (Dec 9 Low) could be tested. Selling pressure will intensify below the last, drowning the pair to 1.0846 (50-DMA).

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