EUR/USD: daily recommendations
EUR/USD found support at 1.1060 on Wednesday and recovered to 1.1150 on Thursday. French and the euro area’s manufacturing PMIs improved, though German reading fell. All in all, the figures released today show that the euro area’s economy is still in desperate need of monetary stimulus. The euro is currently facing resistance at 1.1155 (100-day MA). Further obstacles for the bulls lie at 1.1225, 1.1255 and 1.1290.
A close below 1.1050 is needed to make the picture turn bearish. The euro still has a chance to stabilize above this level. Traders will wait for further data from the US due today, on Friday and the next week. The ECB’s comments about buying more bonds in May and June may be not as strong as initially though by the market, because the general size of the quantitative easing (QE) program will remain the same. If the minutes of the central bank’s April meeting due today at 11:30 GMT show that the ECB wasn’t considering the expansion of the QE program, this may help the euro. Also pay attention to the speech of Mario Draghi and the FOMC members later today.