EUR/USD – Euro subdued as US markets closed for Labor Day

EUR/USD is showing little movement in the Monday session. Currently, the pair is trading at 1.1614, up 0.10% on the day. On the release front, eurozone and German Final Manufacturing PMIs both softened in August, but were within expectations. U.S markets are closed for Labor Day. On Tuesday, the U.S releases ISM Manufacturing PMI.

The eurozone manufacturing sector continues to expand, but there is concern in the markets as the downward trend continued in August. This was evident in Eurozone Final Manufacturing PMI, which lost ground for an eighth straight month. The reading of 54.6, which matched the estimate, marked the lowest level since November 2016. In Germany, Final Manufacturing PMI fell from 56.9 to 55.9. Although this is a respectable reading, it is significantly lower than the readings we saw early in 2018, when the indicator was above the 60-level. German manufacturers remain generally optimistic, but have growing concerns over tariffs which the U.S has slapped on China and the EU.

Investors are keeping a nervous eye on the tariff spat between China and the U.S. So far, the two economic giants have imposed $50 billion in tariffs on each other, and President Trump has threatened further tariffs worth some $200 billion, which could be imposed as early as this week. The U.S could elect to impose the tariffs in smaller bites, such as a $50 billion tariff. With the U.S economy booming, there is little pressure on the Trump administration to shy away from imposing further tariffs. The current trade spat has already seen the U.S dollar gain ground against rivals such as the euro, and further tariffs could boost the U.S dollar.

A jittery start to the month of September

When central banks and the political worlds collide

EUR/USD Fundamentals

Monday (September 3)

  • 3:15 Spanish Manufacturing PMI. Estimate 52.5. Actual 53.0
  • 3:45 Italian Manufacturing PMI. Estimate 51.2. Actual 50.1
  • 3:50 French Final Manufacturing PMI. Estimate 53.7. Actual 53.5
  • 3:55 German Final Manufacturing PMI. Estimate 56.1. Actual 55.9
  • 4:00 Eurozone Final Manufacturing PMI. Estimate 54.6. Actual 54.6
  • 13:15 German Buba President Weidmann Speaks

Tuesday (September 4)

  • 5:00 Eurozone PPI. Estimate 0.3%
  • 10:00 US ISM Manufacturing PMI. Estimate 57.6

*All release times are DST

*Key events are in bold

EUR/USD for Monday, September 3, 2018

EUR/USD for September 3 at 6:40 DST

Open: 1.1602 High: 1.1626 Low: 1.1589 Close: 1.1604

EUR/USD Technical

S1 S2 S1 R1 R2 R3
1.1312 1.1434 1.1553 1.1637 1.1718 1.1840

EUR/USD ticked higher in the Asian session. In European trade, the pair has showed stronger movement in both directions

  • 1.1553 is providing support
  • 1.1637 is the next resistance line

Further levels in both directions:

  • Below: 1.1553, 1.1434 and 1.1312
  • Above: 1.1637, 1.1718, 1.1840 and 1.1961
  • Current range: 1.1553 to 1.1637

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.