Euro Edges Higher Following German IFO Beat

Posted On 24 Nov 2015

EUR/USD is moderately firmer Tuesday after logging a new seven-month low of 1.0593 during the New York PM session Monday. A stronger than expected German Ifo report also help the currency pair gain traction. The yield differential continues to support the currency pair but it appears that the recent run-up in U.S. treasury prices has eroded some of the currency pair’s value.

The German Ifo index beat expectations and jumped to 109 from 108.2 in the previous month. Expectations had been for a broadly steady number, but with both current conditions and future expectations indices moving up, the overall index rose to the highest level since June last year. The diffusion index, shows optimists outnumber pessimists in all sectors, although most notably is the rebound in manufacturing confidence, which belies the weak orders data, concerns about slowing growth in emerging markets and the emission scandal.

The EUR/USD has support at Monday’s lows at 1.0590 and then the April low of 1.0520 and the March low of 1.0480. Resistance is seen near the 10-day moving average at 1.0708. Momentum has flattened and although the MACD is negative the trajectory of flat pointing to consolidation. The RSI is print a reading of 31, just above the oversold trigger level of 30.

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Source:: Euro Edges Higher Following German IFO Beat

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