EUR/USD rebounds from 2019 lows, back around 1.0980
- EUR/USD rebounds from Tuesday’s YTD low at 1.0925.
- Poor US ISM result poured cold water over the USD-rally.
- Services PMIs, EMU Retail Sales, ECB-speak next on tap.
The single currency is looking to extend the rebound from recent lows vs. the Greenback and is now lifting EUR/USD back to the 1.0970/80 band.
EUR/USD focused on data, USD-dynamics
After bottoming out in new yearly lows at 1.0925 on Tuesday, spot has managed to regain some composure as USD-sellers returned to the markets in response to the poor print from the US ISM manufacturing for the month of August.
In addition, EUR also regained some poise after a couple of ECB officials talked down the likeliness of the continuation of bond purchases.
Furthermore, fears of a probable recession in the US economy dragged US yields and the buck lower, while the inability of US and China to find common ground and resume trade talks have also collaborated with the correction lower in USD.
Later in the day, final Services PMIs for the month of August are due seconded by Retail Sales figures in Euroland and the speech by ECB’s Lane in London.
What to look for around EUR
The pair managed to rebound from 2019 lows near 1.0920 in the wake of disappointing US docket, declining US yields and the steady US-China trade front. Recent poor prints from the domestic docket have added extra downside pressure to the single currency and strengthened further the need for ECB stimulus, which is likely to be delivered at the bank’s meeting later this month. This view is also expected to keep occasional bullish attempts well contained for the time being. On the political front, Italian effervescence looks dissipated for the time being, while concerns keep growing around Brexit and the political scenario across the Channel.
EUR/USD levels to watch
At the moment, the pair is gaining 0.02% at 1.0975 and faces the next hurdle at 1.1044 (10-day SMA) followed by 1.1095 (21-day SMA) and finally 1.1163 (high Aug.26). On the other hand, a break below 1.0925 (2019 low Sep.3) would target 1.0839 (monthly low May 11 2017) en route to 1.0569 (monthly low Apr.10 2017).