EURUSD Slumps After Germany’s Manufacturing PMI Big Miss
EURUSD gives up 0.46% at 1.0975, after disappointing from Germany Markit Manufacturing PMI came in at 41.4 below expectations of 44 in September. France Markit PMI Composite which came in at 51.3 below expectations of 52.7 in September, the Manufacturing PMI came in at 50.3 also below expectations of 51.2 in September while the Services PMI came in at 51.6 below forecasts of 53.2 in September.
The ECB in it’s last policy meeting cut the Deposit Rates by 10 bp to -0.50% and unveiled another round of debt purchases.
EURUSD reacted negatively on the news giving up over 50 pips from daily high. The pair rejected at the upper bound of the descending channel last week which paved the way for a move to lower levels. The bears are in control as EURUSD trades below all major moving averages.
EURUSD trapped in the descending channel since June, and now the pressure for dismal macro data might drive price down to previous yearly low. On the downside important support now stands at 1.1071 daily low, a break below will encourage more bears to join the action and drive the price down to 1.0925 YTD lows. On the upside, immediate resistance stands at 1.1025 today’s high, a break above can lead prices up to 1.1067 the upper bound of the descending channel, and then at 1.1103 the 50-day moving average.