EUR/USD – Euro shrugs off dismal German factory orders

EUR/USD is unchanged in Thursday trade. Currently, the pair is trading at 1.1231, down 0.02% on the day. On the release front, German factory orders plunged 4.2%, nowhere near the estimate of 0.3%. Later in the day, the ECB posts the minutes of its March meeting. In the U.S., today’s highlight is unemployment claims, which is expected to rise to 215 thousand. On Friday, the U.S. releases wage growth and nonfarm payrolls, so traders should be prepared for movement from the pair.

German manufacturing numbers continue to point downwards. Factory orders were dismal in February, declining for a fourth successive month. The eurozone’s largest economy has slowed down as a result of the global trade war, with exports and manufacturing particularly hard-hit. Soft global demand could continue, and the Economy Ministry summed up the bleak situation, saying that “manufacturing momentum will continue to be subdued in the coming months, particularly due to lacking external demand”.

After disappointing manufacturing PMIs in March, there was better news from services PMI reports. German and eurozone indicators came in at 55.4, and 53.3, respectively. The PMIs point to continuing growth in the services sector, indicative of steady domestic demand. The same cannot be said about German manufacturing, with manufacturing PMIs losing ground for eight straight releases.

It’s been a disappointing week for U.S. numbers, and the trend continued on Wednesday. ADP nonfarm payrolls plunged to 129 thousand, down from 183 thousand in the previous release. Is this a precursor of what to expect on Friday? Nonfarm payrolls are projected at 175 thousand, a soft number in comparison to recent releases. ISM Non-Manufacturing PMI also stumbled on Wednesday, falling from 59.7 to 56.1 points.

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EUR/USD Fundamentals

Thursday (April 4)

  • 2:00 German Factory Orders. Estimate 0.3%. Actual-4.2%
  • 7:30 ECB Monetary Policy Meeting Accounts
  • 7:30 US Challenger Job Cuts
  • 8:30 US Unemployment Claims. Estimate 215K
  • 10:30 US Natural Gas Storage. Estimate 2B

Friday (April 5)

  • 2:00 German Industrial Production. Estimate 0.6%
  • All Day – Eurogroup Meetings
  • 8:30 US Average Hourly Earnings. Estimate 0.2%
  • 8:30 US Nonfarm Employment Change. Estimate 175K
  • 8:30 US Unemployment Rate. Estimate 3.8%

*All release times are DST

*Key events are in bold

EUR/USD for Thursday, April 4, 2019

EUR/USD for April 4 at 6:45 DST

Open: 1.1233 High: 1.1248 Low: 1.1221 Close: 1.1231

EUR/USD Technical

S1 S2 S1 R1 R2 R3
1.1046 1.1120 1.1212 1.1300 1.1434 1.1553

EUR/USD ticked lower in the Asian session but has recovered in European trade

  • 1.1212 is weak support level
  • 1.1300 is the next resistance line
  • Current range: 1.1212 to 1.1300

Further levels in both directions:

  • Below: 1.1212, 1.1120, 1.1046 and 1.0951
  • Above: 1.1300, 1.1434 and 1.1553

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

Market Analyst at OANDA
A highly experienced financial market analyst with a focus on fundamental analysis, Kenneth Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in several major online financial publications including, Seeking Alpha and FXStreet. Based in Israel, Kenny has been a MarketPulse contributor since 2012.
Kenny Fisher

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