Another disappointing figure from Germany: industrial output rises only 0.3% contrary to 1.4% expected in the month of June. This confirms the notion of a significant slowdown in the second quarter, after a leap of 0.8% in GDP during the first one. The German locomotive seems to have run out of steam.
The recovery of EUR/USD seems to be ending. The pair could not even touch 1.34 on its way up and now it is back to 1.3375.
The euro enjoyed the so called “flash crash” of the dollar yesterday to gain so ground. A spike down in USD/JPY triggered wider greenback selling on reasons that are still unknown.
However, we’re now back to the influence of the hard data, and it’s not that good. The weak rise in industrial production joins the crash in factory orders reported earlier in the week.
Yesterday, EUR/USD fell to deeper ground not only on the disappointing German data but also on the news that Italy is back in recession. The low that was recorded was 1.3332, just above support at 1.3325.
Further and critical support stands at 1.3295, which is the November 2013 low.
Needless to say, the big event of today is the ECB decision. Here is out preview. Click to play:Get the 5 most predictable currency pairs