EUR/USD analysis ahead of PMI data signals $1.10 whipsaw

Steffy Bogdanova
April 21, 2023 8:24 am

This article was submitted by Aaron Hill from FP Markets.

Euro area, UK and US manufacturing/services PMIs are in focus today.

The euro area PMIs are scheduled to be released in early European cash trading at 9:00 am GMT+1, followed by UK PMIs 30 minutes later at 9:30 am GMT+1, and then US PMIs in the early hours of US cash trading at 2:45 pm GMT+1.

Bloomberg Estimates:

Euro area manufacturing PMI has a median estimate of 48.0 vs 47.3 prior, with a forecast range between 48.5 and 47.0.

EUR/USD Analysis Ahead of PMI Data Signals $1.10 Whipsaw, FP Markets

UK manufacturing PMI has a median estimate of 48.4, from 47.9 prior and a forecast range between 49.4 and 47.5.

EUR/USD Analysis Ahead of PMI Data Signals $1.10 Whipsaw, FP Markets

US manufacturing PMI has a median estimate of 49.0, from 49.2 prior and a forecast range between 49.5 and 47.5.

EUR/USD Analysis Ahead of PMI Data Signals $1.10 Whipsaw, FP Markets

Daily Markets Commentary

EUR/USD Technical View:

The technical outlook for the EUR/USD is optimistic on the weekly chart, finding some comfort north of support at $1.0888. Technically speaking, the currency pair is in the early phase of an uptrend on the weekly after pencilling in a higher high at $1.1076 last week, which opens the gate for a run to resistance visible at $1.1174.

A similar view is evident on the daily timeframe; the pair has gradually risen since retesting the breached 200-day simple moving average at $1.0759. Resistance warrants attention at $1.1138, and support is thin until back around the SMA, as recent upside movement appears to have consumed any local support.

On more of a shorter-term view, the H1 timeframe exhibits an interesting area of Fibonacci resistance north of $1.10 (consisting of two 1.272% Fibonacci projection ratios around $1.1013 [many Harmonic players may recognise these ratios as ‘alternate’ AB=CD patterns] and a 61.8% Fibonacci retracement at $1.1013). Therefore, any whipsaw motion north of the psychological level could see active sellers emerge from $1.1013ish as sellers attempt to take advantage of buy-stops that will be filled above $1.10 (commonly referred to as a ‘stop run’). To the downside, all eyes will be on the $1.09 handle.

EUR/USD Analysis Ahead of PMI Data Signals $1.10 Whipsaw, FP MarketsCharts: TradingView

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Opinions are personal to the authors and do not reflect the opinions of LeapRate. This is not a trading advice.

LeapRate Analyst

Experienced writer and journalist, working in the global online trading sector, Steffy is the Editor of LeapRate. She has previous experience as a copywriter and has been with the company since January 2020. Steffy has a British and American Studies degree from St. Kliment Ochridski University in Sofia.
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