EURUSD on Tuesday dropped -0.11% to 1.11191. What we know.

Dear ,

As requested, let’s look at EURUSD and the recent events that happened in the previous trading session.

EURUSD Analysis

Performance after Tuesday
Period	Pct	Chg	Momentum
Tuesday	-0.11%	-11.8 Pips
Week to-date	0.28%	30.7 Pips
September	0.35%	38.7 Pips

Upcoming key events (London Time)

  Wed 07:00 PM USD Fed Interest Rate Decision (Federal Funds Rate)
  Wed 07:00 PM USD Interest Rate Projections

What happened lately

In the United States, industrial production witnessed a significant rebound in August, increasing to 0.8% from July’s -0.6%, signaling a promising revival in manufacturing activity. However, retail data were less favorable. According to the Census Bureau, the Retail Trade Control Group, which is often used as a more accurate gauge of consumer spending, dropped to 0.3% in August, down from a revised 0.4% in July. Moreover, Monthly Retail Trade excluding Automobiles also dipped to 0.1% from 0.4% over the same period, indicating a slowdown in consumer expenditures outside the automotive sector.

In the Euro Area, economic sentiment took a considerable hit. The ZEW Survey for Economic Sentiment dropped to 9.3 points in September from 17.9 points in August, reflecting growing economic concerns. Similarly, Germany, the region’s largest economy, saw its ZEW Indicator of Economic Sentiment sag to 3.6 points from 19.2 in the previous month. Furthermore, Germany’s ZEW Survey of the Economic Situation dwindled to -84.5 points in September, compared to -77.3 in August, highlighting worsening economic conditions. Both these data points are sourced from ZEW.

The subpar economic data from the Euro Area and Germany, coupled with the mixed economic picture from the United States, have exerted downward pressure on the EURUSD currency pair. The decline in economic sentiment in the Euro Area and Germany signifies potential economic struggles, which could weaken the Euro. Conversely, the bounce-back in U.S. industrial production is a positive sign for the U.S. economy. However, softer retail trade figures may temper this optimism. As a result, EURUSD dropped by -0.11% to 1.11191. Looking ahead, crucial events such as the Federal Reserve’s interest rate decision and interest rate projections could further influence the pair. If the Federal Reserve maintains or raises interest rates, it could potentially strengthen the U.S. Dollar, extending the EURUSD downtrend.

What can we expect from EURUSD today?

EURUSD on Tuesday dropped -0.11% to 1.11191. Price is above 9-Day EMA while Stochastic is rising.

Updated daily direction for EURUSD looks bearish as the pair posted lower in Tuesday trading session.

Looking ahead for the day, immediate support level is at S1 1.11044 with break below could see further selling pressure towards S2 at 1.10898. To the upside, with the current momentum bearish, we prefer to look at breakout of the recent daily high of 1.11461 as a potential indicator of buying interest. Failure to break the resistance level would continue to echo bearish sentiment. A close below 1.11106 would indicate selling pressure.

For the week to-date, take note that EURUSD is mixed as compared to the prior week.

Key levels to watch out: