I’m expecting currency strength from the euro today since Germany and France are printing their flash PMI readings for this month.
Do you think EUR/NZD could bounce off the channel support?
Before moving on, check out the headlines that rocked the markets in the last trading sessions:
Fresh Market Headlines & Economic Data:
- Powell: Fed will not hike based on inflation fears alone
- Japanese flash manufacturing PMI down from 53.0 to 51.5
- Australia’s goods trade surplus widened from 9.67B AUD to 13.32B AUD
- German flash manufacturing PMI up from 64.4 to 64.9
- German flash services PMI up from 52.8 to 58.1
- French flash manufacturing PMI down from 59.4 to 58.6
- French flash services PMI up from 56.6 to 57.4
Upcoming Potential Catalysts on the Economic Calendar:
- Canadian retail sales at 12:30 pm GMT
- U.S. flash manufacturing and services PMIs at 1:45 pm GMT
- EIA crude oil inventories at 2:30 pm GMT
What to Watch: EUR/NZD
This pair has been cruising higher inside an ascending channel on its 4-hour time frame. Price is bouncing off support, which happens to line up with the 61.8% Fibonacci retracement level.
Can buyers step up their game from here?
If the floor keeps holding, EUR/NZD could recover to the upside targets at the swing high (1.7126) or the channel resistance.Stochastic still has some room to climb before reaching the overbought zone, so the pair could follow suit while buyers are in control. A larger dip, on the other hand, could find buyers at the channel bottom near the 1.6950 minor psychological mark.
There are no major reports due from New Zealand, but it’s worth noting that risk-off flows stemming from last week’s post-FOMC moves could keep weighing on the Kiwi.
Meanwhile, flash PMI readings from the eurozone economies came in mixed. Germany printed stronger than expected results for its manufacturing and services sectors while France reported downside surprises.
