Eurusd edges lower amid mixed economic indicators from US and Euro Area

EURUSD Analysis

Performance after Tuesday
Period	Pct	Chg	Momentum
Tuesday	-0.02%	-1.7 Pips
Week to-date	0.56%	58.9 Pips
November	-2.7%	-293.5 Pips

Upcoming key events (London Time)

No major events for the day.

What happened lately

In the United States, October saw a downturn in the housing sector, with Housing Starts decreasing to 1.311 million from a revised figure of 1.353 million in September. This marks a decline of approximately 3.1 million from the initial report of 1.354 million in September as stated by the Census Bureau. Additionally, Building Permits experienced a significant drop, falling to -0.6 million from September’s revised count of 1.425 million. These declines indicate potential challenges in the housing market, which could reflect broader trends in economic activity and consumer confidence within the country.

Meanwhile, in the Euro Area, consumer prices reflected stability across multiple indices during October. The Core Harmonised Index of Consumer Prices (HICP), as reported by Eurostat, remained unchanged at 2.7% when compared to September. Moreover, the Harmonized Index of Consumer Prices stayed constant at 0.3%, mirroring the previous month’s figures. The Core HICP also showed no variation, maintaining a 0.2% rate. This stability indicates a lack of inflationary pressures within the Euro Area, suggesting consistent but subdued economic activity over the measured period.

The EURUSD currency pair experienced minor changes, dropping by 0.02% to settle at 1.05926. The pair’s consolidation suggests an equilibrium point where neither the Euro nor the US Dollar displayed overwhelming strength or weakness against one another. The unchanged consumer price indices in the Euro Area imply no immediate pressures for monetary policy shifts from the European Central Bank, providing little support for the Euro to gain strength in the short term. On the other hand, the decline in US housing starts and building permits could signal underlying economic weakness, which might negatively impact the US Dollar. However, without significant deviation in upcoming economic indicators, both currencies seem poised to remain in a holding pattern, contributing to the minimal fluctuation noted in the EURUSD pair.

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What can we expect from EURUSD today?

EURUSD on Tuesday dropped -0.02% to 1.05926. Price is below 9-Day EMA while Stochastic is rising.

Updated daily direction for EURUSD looks mixed as the pair is likely to consolidate above 1.05433 (S1).

Looking ahead today, to see upside interest, we prefer to look at price breakout of last daily high of 1.06010 or trades above daily pivot 1.05722. Break above could target R1 at 1.06214. While to the downside, we are looking at 1.05433 (S1) and daily low of 1.05229 as support levels. EURUSD need to break on either side to indicate a short-term bias. A close below 1.05229 would indicate selling pressure.

For the week to-date, take note that EURUSD is mixed as compared to the prior week.

Key levels to watch out:

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