EUR/USD: Euro Trading a Tad Higher in the Asian Session

Fundamental analysis of Forex market

For the 24 hours to 23:00 GMT, the EUR declined 0.05% against the USD and closed at 1.1202.

In the US, data showed that the Chicago Fed Purchasing Managers’ Index advanced to a level of 48.9 in December, surpassing market consensus for a rise to a level of 47.9. In the previous month, the index had registered a level of 46.3. Moreover, the nation’s advance goods trade deficit unexpectedly narrowed to $63.2 billion in November, marking its lowest level since 2016 and cofounding market anticipations for the deficit to expand to $68.8 billion. In the prior month, the nation had recorded a revised deficit of $66.8 billion. Further, the US pending home sales rose 7.4% on an annual basis in November, higher than market expectations for an increase of 5.8%. In the previous month, pending home sales had recorded a rise of 4.4%. On the other hand, the Dallas Fed manufacturing business index unexpectedly fell to a level of -3.2 in December, defying market expectations for an increase to a level of 1.5. The index had recorded a level of -1.3 in the previous month.

In the Asian session, at GMT0400, the pair is trading at 1.1204, with the EUR trading slightly higher against the USD from yesterday’s close.

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The pair is expected to find support at 1.1184, and a fall through could take it to the next support level of 1.1163. The pair is expected to find its first resistance at 1.1223, and a rise through could take it to the next resistance level of 1.1241.

Amid lack of macroeconomic releases in the Euro-zone today, traders would focus on the US housing price index for October and the consumer confidence index for December, set to release later in the day.

The currency pair is showing convergence with its 20 Hr moving average and trading above its 50 Hr moving average.