US Durable Goods Orders Preview: What to Expect of EUR/USD?
US Durable Goods Orders Preview: What to Expect of EUR/USD?
Dollar maintained its bid tone in Europe, keeping the EUR/USD pair moderately lower in the range of 1.1150-1.1170. At one point, risk-off in Europe did come to the rescue for EUR, but failed to push it into the positive territory.
Eyes US durable goods orders data
The Commerce Department is expected to report that orders for durable goods fell by 2.8% last month. Following January’s rebound a decline in February would indicate the manufacturing sector recovery is yet to bottom out.
However, the headline figure is erratic and can be misleading; hence next trend in the USD is likely to be decided by a category - New orders for nondefense capital goods excluding aircraft that serves as a proxy for business investment plans. In January, the figure registered its biggest advance since June 2014.
Strong new orders for nondefense capital goods excluding aircraft figure could trigger another led upwards in the USD. Moreover, Fed policymakers have been on the wires since Monday talking up April/June rate hike bets through their hawkish comments. Calls for April/June rate hike are on the rise and this strong core numbers would be well received by the markets.
On the contrary, weak details, but a strong headline figure may do little to help USD and trigger profit taking in the USD longs heading into the extended weekend in Europe.
EUR/USD Technical Levels
At the time of writing, the pair was trading around 1.11 levels. The immediate support is seen at 1.1115 (50% of 1.1714-1.0517). A break under the same amid current bearish momentum could see the spot cut through 1.1088 (50% of 1.0463-1.1714). Acceptance below the same would expose 200-DMA at 1.1044; a level under which short-term bullish invalidation is seen.
Conversely, another attempt to break above 1.1173 (23.6% of 1.0517-1.1376) if successful would result in spot testing 1.12 (zero figure + rising trend line hurdle), above which the spot may test supply at 1.1257 (61.8% of 1.1714-1.0517).
(Market News Provided by FXstreet)
