The EURUSD pair is actively declining during the trading session on Wednesday. Since the opening of the day, the European currency sank 0.3% against the dollar and is quoted at 1.1870. It should be noted that the sell-off of the main currency risk continues for the second session in a row after an unsuccessful attempt by EUR buyers to gain a foothold above the psychological resistance of 1.20.
The euro is under pressure from the recovery of the dollar, supported by strong macroeconomic data. According to the Institute for Supply Management (ISM), the purchasing managers' index (PMI) for the US manufacturing sector rose to 56.0 in August from 54.2 in July, indicating increased activity. The statistics strengthened the optimism of market participants regarding the prospects for the recovery of the American economy. The index of new manufacturing orders from ISM for the same period jumped from 61.5 points to 67.6 points, while analysts had expected it to decline to 53.5 points.
Additional support for the dollar was provided by the comments of US Treasury Secretary Stephen Mnuchin, who urged Congress to approve another stimulus package, promising to call the Speaker of the House of Representatives Nancy Pelosi to speed up negotiations. During a hearing in the House of Representatives on the situation with the coronavirus, Mnuchin also said that the administration of President Donald Trump plans to present an initiative to protect tenants affected by the pandemic from eviction through an executive order
An additional factor for the euro decline could also be the statistics from the Eurozone, which more disappointed. Thus, the core consumer price index slowed down in August from 1.2% y / y to 0.4% y / y, which turned out to be significantly worse than market expectations at 0.9% y / y. The main consumer price index for the same period fell by 0.2% y / y at all, while investors expected its growth by 0.2% y / y. The unemployment rate in the Eurozone in July rose from 7.7% to 7.9%, which was only 0.1% better than experts' forecasts.
Today at 15:15 Moscow time the ADP report on the number of jobs in the US private sector will be released, which will be the next trigger for the movement of the US currency. Economists surveyed by the WSJ expect a 1.17 million increase in US private sector jobs in August. However, if the report is disappointing, dollar sell-off will resume with the same force, pushing the euro higher.
EURUSD BuyLimit 1.1820 TP 1.2050 SL 1.1770
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