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EUR/USD  dipped just a bit lower and touched a new low of .13113 before returning a bit higher, but  it is still marking a lower high. As US traders return to the scene, tensions are mounting both in Ukraine and regarding the ECB meeting on Thursday. In the former, NATO is gearing up in Eastern Europe and Merkel accepts economic suffering in return for stopping aggression. In the latter, it seems that France and Germany want different things from Draghi.

 Here is a quick update on what’s moving the pair.

  • EUR/USD dropped a bit lower in the range before stabilizing.
  • Current range: 1.31 to 1.3150.

Further levels in both directions:

EURUSD September 2 2014 technical 1h chart for currency trading euro dollar

  • Below: 1.31 1.3050, 1.30 and 1.2940.
  • Above: 1.3150, 1.3175, 1.3220 and 1.3295.
  • 1.3150 switches to resistance after the downfall on Friday.
  • 1.3112 is the new low, but real support is at the round number of 1.31.

EUR/USD Fundamentals

  • 7:00 Spanish Unemployment Change. Exp. +25.5K, actual +8.1K.
  • 9:00 Euro-zone PPI. Exp. 0%.
  • 13:45 US  Final Markit Manufacturing PMI. Exp. 58 points.
  • 14:00 US ISM Manufacturing PMI. Exp. 57 points. See how to trade the figure with USDJPY.
  • 14:00 US  Construction Spending. Exp. +0.9%.
  • 14:00 US  IBD/TIPP Economic Optimism. Exp. 46.2 points.

*All times are GMT.

For more events and lines, see the  Euro to dollar  forecast.

EUR/USD Sentiment

  • Stronger rhetoric regarding Ukraine: After stronger rhetoric from some Eastern European leaders over the weekend, and the word “statehood” from Putin, we now heard from German Chancellor Angela Merkel, that said that paying an economic price is a small price and that changing borders in Europe is unacceptable. US President Obama is visiting Estonia today on the background of a NATO task force that  is sent to defend Eastern European countries. Ukraine is not a NATO member.
  • Pressure on Draghi: Tensions is mounting towards the rate decision on Thursday. Will Draghi announce QE or just hint about an upcoming announcement? Will there be more cuts in the rock bottom interest rates? Expectations stand on more words but no new action. France wants Draghi to weaken the euro while Germany was reportedly unhappy with his comments in Jackson Hole – comments that implied more action.
  • First NFP hint: The US returns from the long weekend and the manufacturing figure is the first hint for Friday’s big event.  See how to trade the ISM Manufacturing PMI with USDJPY. We will get more data later in the week. While US traders certainly contribute to action, the focus is currently on Europe.