- Monday’s data painted a gloomy picture of the eurozone economy.
- Market participants increased the odds of an October ECB cut to 77%.
- The US composite PMI remained at 54.4 in September.
EUR/USD price analysis shows a move from bullish to a range market following Eurozone and US PMI data. Business activity in the eurozone worsened in September, the euro sank. Meanwhile, things are steady in the US.
–Are you interested in learning more about buying NFT tokens? Check out our detailed guide-
Monday’s data painted a gloomy picture of the eurozone economy. S&P Global released a set of PMI data showing the composite number at 48.9 in September, down sharply from 51.0 the previous month.
A decline in business activity is a sign that the economy is struggling due to high interest rates. Accordingly, market participants increased the odds of an ECB cut in October to 77%. The European Central Bank began its cycle of interest rate cuts before the Fed. However, it paused after the first cut as it became clear that inflation remained stubborn. However, economic weakness is putting more pressure on the central bank to cut at its next meeting.
Meanwhile, in the US, the composite PMI was steady at 54.4 in September after a reading of 54.6 in August. The US economy has remained resilient despite high rates. Last week, retail sales data revealed an unexpected jump, indicating resilient consumer spending. Therefore, the Fed could achieve a soft landing, easing inflation without destroying growth.
The next major US reports will include GDP and core PCE. These numbers will shape the outlook for future rate cuts. Currently, market participants are betting on another big rate cut in November.
EUR/USD key events today
- US CB Consumer Confidence
EUR/USD technical price analysis: Consolidation after RSI divergence
On the technical side, the EUR/USD price is breaking through the 30-SMA amid wild swings. At the same time, the price respects the support of 1.1075 and the resistance level of 1.1175. Meanwhile, the RSI is also crossing the key 50 mark, which is a sign that the price is moving.
-Are you looking for the best CFD broker? Check out our detailed guide-
Moreover, when EUR/USD reached resistance at 1.1175, the RSI made a bearish divergence, signaling a possible reversal. Soon after, the bears made a massive candle that broke below the 30-SMA. If the price stays below the SMA, it could soon return to the support level of 1.1075. A break below this level would allow the bears to target the 1.1000 support.
Do you want to trade Forex now? Invest in eToro!
67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing money.
