- Euro traded down against the US Dollar, and currently setting up for more losses.
- There was a bullish trend line formed on the hourly chart of the EURUSD pair, which was broken to open the doors for more losses.
- German Services PMI released by the Markit Economics posted a decline from the last reading of 55.5 to 55.1 in March 2016.
- Euro Area Services PMI also posted a decline and came in at 53.1 in March 2016.
The Euro looks like broke a major support area against the US Dollar and may trade down further. There was a bullish trend line formed on the hourly chart of the EURUSD pair, which was broken by the bears recently.
The pair also closed below the 50 and 100 hourly simple moving average. If the current trend continues, the EURUSD pair may trade towards the 50% Fib retracement level of the last leg from the 1.1170 low to 1.1439 high.
On the upside, the broken trend line may act as a resistance and stall more gains in the short term.
Euro Area Services PMI
Earlier today, the Euro Area PMI service, which is an indicator of the economic situation in the Euro Zone services sector was released by the Markit Economics. The market was expecting no change in the PMI from 54 in March 2016. However, there was a decline in the services PMI from 54 to 53.1 in March 2016.
The report highlighted that the “March saw the rate of economic expansion in the euro area improve for the first time in three months. The extent of the acceleration was negligible, however, and less marked than that indicated by earlier flash data. Manufacturing saw faster growth of production, but this was mostly offset by a slower rate of output expansion at service providers”.
Overall, the outcome was positive, but missed the mark, increasing the chances of more declines in EURUSD.