Home EUR/USD Price Plummets After Dismal PMI, Eying 1.08 Breakout

EUR/USD Price Plummets After Dismal PMI, Eying 1.08 Breakout

  • The bias remains bearish as long as it stays below the median line.
  • The US data dump should bring sharp movements.
  • Dropping below the S1 triggered deeper declines.

The EUR/USD price continued its downward trend today, reaching 1.0810, just above the daily low of 1.0803.

The US dollar gained strength, reflecting the greenback’s dominance in the currency market. Yesterday, the pair attempted to bounce back and recover some of its losses, supported by a better-than-expected Eurozone Current Account and mixed US data.

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However, today’s economic indicators triggered sharp movements. The German and Eurozone Flash Services PMIs both missed expectations and fell below the 50 level, indicating contraction in the service sector.

The UK Flash Services PMI also disappointed, coming in at 48.7 versus 50.9 forecasted. These results boosted the demand for safe-haven currencies like the USD and JPY in the short term.

Later today, the Canadian Retail Sales and Core Retail Sales data may have some impact on the greenback, but the main focus will be on the US economic figures.

The Flash Manufacturing PMI is expected to remain below 50 at 48.9, while the Flash Services PMI is projected to be slightly lower at 52.1 compared to 52.3 in the previous month.

The New Home Sales and the Eurozone Consumer Confidence data will also be released. Weak US data could weigh on the greenback, while positive data could reinforce the USD’s dominance in the currency market.

EUR/USD Price Technical Analysis: Bearish dominance

EUR/USD price
EUR/USD price hourly chart

The EUR/USD pair fell further after failing to break above the 1.0861 resistance. The large gap between the high and low shows strong selling pressure and signals more losses.

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The pair has also breached the weekly S1 (1.0820), suggesting a deeper drop. However, it may bounce back briefly to test the S1 before resuming its downtrend. The outlook is bearish as long as the pair stays below the median line (ml) of the descending pitchfork.

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Olimpiu Tuns

Olimpiu Tuns

Olimpiu Tuns graduated with a Master in Business Administration and is a seasoned Market Analyst / Trader / Trainer with 10 years of experience in the financial markets having expertise in Forex, Commodities, Index, Cryptocurrencies, and Stocks. He worked as a Market Analyst for three major brokerage companies, as a prop trader, and as a contributor/content creator for news portals and educational platforms.