EURUSD Trades At 4-Month Highs Ahead of PMI Reports

Summary:
• Before 2019 came to an end, EURUSD surged to its 4-month highs. With a roster of PMI reports due today, will it be able to hold on to its gains?

EURUSD surged to its four-month highs on the last trading day of 2019. The currency pair opened at 1.1196 and traded steadily higher to tap its 4-month highs at 1.1238. By the New York session close, EURUSD had settled at 1.1209.

CB Consumer Confidence Misses Forecasts

On Tuesday, the only report released for EURUSD was the CB Consumer Confidence report for December. It fell short of the market’s 128.0 forecast when it printed at 126.5. This may have helped the euro finish higher against the US dollar.

Euro Zone and US PMIs Due Today

For today, a handful of reports are due from the euro zone and the US. At 8:15 am GMT, the Spanish manufacturing PMI for December is eyed to print at 46.9. Then at 8:45 am GMT, the Italian manufacturing PMI is expected at 47.3. Meanwhile, the French final manufacturing PMI for the month is seen to be above the 50.0 baseline reading that indicates an expansion at 8:50 am GMT. The consensus is at 50.3. On the other hand, Germany’s final manufacturing PMI, which is due at 8:55 am GMT, is seen at 43.4. Then at 9:00 am GMT, the final version of the euro zone’s manufacturing PMI is anticipated to print at 45.9.

Meanwhile, across the Atlantic, the US unemployment claims report is eyed to come in at 222,000. Then at 2:45 pm GMT, the country’s final manufacturing report is expected at 52.5.

Better-than-expected figures from the euro zone or disappointing US data could be bullish for EURUSD. On the other hand, worse-than-expected euro zone reports or positive US figures may be bearish for the currency pair.

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EURUSD Outlook

Will EURUSD continue is rally today? A close above its December 31 highs at 1.1238 could mean that buyers are priming to push the currency pair to its June 2019 highs at 1.1320.

On the other hand, if sellers dominate today’s trading, we could see EURUSD pull back to the 61.8% Fib level (drawing the Fibonacci retracement tool from the low of December 24 to the high of December 31). This price also seems to coincide with the rising trend line from connecting the lows of November 29, December 20, and December 24. On top of that, the currency pair could also find support at the 100 SMA. If support at this level does not hold, we could see EURUSD fall to its December 24 lows at 1.1065.