The EUR/USD pair reached a support zone, so now the buyers could try to take the price higher. Still, the bearish pressure is high as the Dollar Index continues to stay higher. In the short term, the currency pair could rebound only because the eurozone data have come in better than expected, while the US data disappointed investors.
Today, the German Services PMI was reported at 53.4 points above 51.4 expected, signaling further expansion, while the German Flash Manufacturing was reported at 57.6 points versus 57.0 expected. Also, the eurozone Flash Services PMI increased from 54.6 to 56.6 points, whereas specialists expected a potential drop to 53.6 points. At the same time, the Flash Manufacturing PMI jumped from 58.3 to 58.6 points, though traders expected to see a potential drop to 57.5 points.
On the other hand, the US Flash Services PMI and Flash Manufacturing PMI reported worse than expected data signaling a slowdown in expansion in both sectors.
EUR/USD at supportEUR/USD dropped below the Descending Pitchfork's lower median line (LML) but it has failed to stay there. Also, 1.1239 stands as a key level, as a historical obstacle. It remains to see what will really happen here. A bullish pattern could signal a potential rebound.
Still, technically, EUR/USD could come back to test and retest the near-term support levels before trying to rebound. The currency pair could turn to the upside only if the Dollar Index drops.
EUR/USD outlookStaying above the 1.1239 and above the lower median line (LML) followed by a new higher high, a bullish closure above 1.1275 could signal that the rate may register an upside movement. Jumping and stabilizing above 1.1275 could be seen as a long opportunity.
On the other hand, dropping and stabilizing below the Descending Pitchfork's lower median line (LML) and a new lower low could signal further drop.