EURUSD Analysis
| Performance after Monday | |||||
| Period | Pct | Chg | Momentum | ||
| Monday | -0.27% | -28.6 Pips |  |
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| Week to-date | -0.3% | -30.8 Pips |  |
||
| December | -1.52% | -160.8 Pips | |
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Upcoming key events (London Time)
No major events for the day.
What happened lately
In the United States, the news covers two distinct economic indicators. The Pending Home Sales for November showed a notable increase, rising to 2.2% from a revised 1.8% in October. Initially, October’s figure was reported at 2%, indicating a re-evaluation with a slight downward revision of the previous month’s performance. This upward trend in home sales suggests resilience in the housing market, hinting at potential underlying demand strength despite various economic challenges.
Conversely, the Chicago Purchasing Managers’ Index (PMI), a key indicator of manufacturing activity, fell significantly in December. The PMI dropped to 36.9 from 40.2 in November, signaling contraction in the manufacturing sector since any figure below 50 indicates reduced activity. The decline in the PMI suggests that manufacturers are likely grappling with hurdles such as supply chain constraints and reduced demand, potentially influenced by global economic uncertainties.
The data provided also reflects a decrease in the EURUSD exchange rate, falling by 0.27% to 1.04022. The positive pending home sales data may have lent some support to the US dollar, as improved economic prospects can enhance currency strength. However, the drop in the Chicago PMI could counteract some of this strength due to concerns over economic slowdown in the manufacturing sector.
Overall, the mixed economic signals from the US, comprising robust home sales but weakened manufacturing, create an ambiguous impact on the EURUSD. The modest decline in the EURUSD might stem from the stronger US dollar, as traders could be initially reacting positively to the home sales figures. Without any major events happening the same day, investors might focus on the existing data to gauge future market directions. The balance between those opposing influences will be critical in shaping EURUSD’s trajectory moving forward.
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What can we expect from EURUSD today?
EURUSD on Monday dropped -0.27% to 1.04022. Price is below 9-Day EMA while Stochastic is falling.
Updated daily direction for EURUSD looks bearish as the pair posted lower in Monday trading session.
Looking ahead for the day, immediate support level is at S1 1.03629 with break below could see further selling pressure towards S2 at 1.03237. To the upside, with the current momentum bearish, we prefer to look at breakout of the recent daily high of 1.04584 as a potential indicator of buying interest. Failure to break the resistance level would continue to echo bearish sentiment. A close below 1.03714 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:
| R3 | 1.05369 |
| R2 | 1.04977 |
| R1 | 1.04499 |
| Daily Pivot | 1.04107 |
| S1 | 1.03629 |
| S2 | 1.03237 |
| S3 | 1.02759 |
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