(DAILY NOTION) EUR/USD Possible Trading Below 1.200 Support Level, Next Mover: German GDP Data

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(DAILY NOTION) EUR/USD Possible Trading Below 1.200 Support Level, Next Mover: German GDP Data

Illustration photo of EUR/USD daily chart from Tradingview

The EUR/USD is under pressure ahead of the important German GDP data and U.S. personal income and spending data. The EUR/USD is trading at 1.2098, which is below the important resistance level of 1.2188.

The EUR/USD is reacting to the mixed economic data from the United States. The data showed that the U.S. economy rose by 4% in the fourth quarter while initial jobless claims declined from 914,000 to 847,000. Further data showed that new home sales rose by 1.6% to 814,000 in December. In the previous month, the sales fell by 12.6%.

The EUR/USD will today react to the German GDP data. The data is expected to show that the economy contracted by 3.4% in the fourth quarter. These numbers will come a few days after Germany published relatively weak business and consumer sentiment numbers. 

The pair will also be affected by the U.S. personal income and spending data. These numbers are expected to show that personal income rose by 0.1% while spending fell by about 0.4%.

On the daily chart, we see that the euro to USD pair has been in a steady decline recently. It is now trading slightly above the important support at 1.2050. The 25-day and 15-day exponential moving averages are also making a bearish crossover. Therefore, in my view, it is just a matter of time before the EUR/USD price breaks out lower. If this happens, the next support to watch is 1.200.

FOLLOWME EUR/USD Overall Sentiment (As of 02:30 p.m., Jan 29, 2021).

Short - 56.81%

Long - 43.19%

For information please refer to Crispus Nyaga.

Edited 29 Jan 2021, 14:30

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