EUR/USD – Steady As Markets Await Services PMIs

EUR/USD is not showing much movement on Tuesday, as the markets keep an eye on Wednesday’s PMI releases. In the European session, the pair is trading slightly above the 1.35 line. In economic news, US ISM Manufacturing PMI slipped badly in January, dropping to a ten-month low. In the Eurozone, Italian and Eurozone inflation numbers were very weak. Spanish Unemployment Change had a dismal January, posting a huge jump in unemployment claims. It’s a quiet day in the US, with only two releases scheduled.

In the US, ISM Manufacturing PMI, a key event, looked weak in January. The index came in at 51.3 points, a sharp drop from the December reading of 57.0. This was well below the estimate of 56.2 points. The markets will be looking for better news from the ISM Non-Manufacturing PMI on Wednesday. If this index also disappoints, the US dollar could continue to lose ground.

Spanish Unemployment Change jumped to 113 thousand in January, shocking the markets which had expected a decrease. The Spanish employment minister tried to put a positive spin on the data, noting that January unemployment numbers typically climb sharply, and this figure was the lowest January increase since 2007. Recent Spanish data has looked strong, but clearly the staggering unemployment levels will continue to weigh on the economy.

February started the month on a positive note, as Eurozone manufacturing PMIs continue to point to expansion. Spanish Manufacturing PMI improved to 52.2 points, above the estimate of 51.3. The index has spent most of the second half of 2013 above the 50-point level, indicating ongoing expansion in the manufacturing sector. Italian Manufacturing PMI showed little change at 53.1 points, a good reading but short of the estimate of 54.2 points. Eurozone Final Manufacturing PMI continues to rise, as the index hit 54.0 points, just above the estimate of 53.9 points. We’ll get a look at the Eurozone Services PMIs on Wednesday.

German releases have had a good run in January, but that came to a crashing halt on the last trading day of January. Retail Sales slid by 2.5%, its sharpest drop since October 2012. The markets had expected a weak gain of 0.2%. December releases have looked solid, led by Unemployment Change, Consumer Climate and Ifo Business Climate rose, indicating that German businesses and consumers are optimistic about the economy as we begin 2014. Will the Retail Sales release prove to be just a blip? Germany is the Eurozone’s largest economy, and the region will need the country to lead the way to an economic recovery on the continent.


EUR/USD for Tuesday, February 4, 2014

Forex Rate Graph 21/1/13

EUR/USD February 4 at 10:50 GMT

EUR/USD 1.3517 H: 1.3539 L: 1.3494


EUR/USD Technical

S3 S2 S1 R1 R2 R3
1.3267 1.3347 1.3410 1.3585 1.3649 1.3786


  • EUR/USD is trading quietly on Tuesday. The pair briefly dropped below the 1.35 line early in the European session.
  • 1.3410 is providing support. This is followed by a support line at 1.3347.
  • 1.3585 is the first line of resistance. This is followed by resistance at 1.3649.
  • Current range: 1.3410 to 1.3585

Further levels in both directions:

  • Below: 1.3410, 1.3347, 1.3267 and 1.3189
  • Above: 1.3585, 1.3649, 1.3786, 1.3893 and 1.4000


OANDA’s Open Positions Ratio

EUR/USD ratio has changed directions in Tuesday trading, with gains in short positions. This is reflected in the pair’s current movement, as the euro has posted very slight losses. Short positions have a majority, indicative of trader bias towards the dollar continuing to gain ground against the euro.

The euro is trading quietly in Tuesday trading. In the European session, EUR/USD is trading slightly above the 1.35 line.


EUR/USD Fundamentals

  • 8:00 Spanish Unemployment Change. Estimate -21.3K. Actual 113.1K.
  • 10:00 Italian Preliminary CPI. Estimate 0.3%.
  • 10:00 Eurozone PPI. Estimate 0.3%.
  • 15:00 US Factory Orders. Estimate -1.9%.
  • 15:00 US IBD/TIPP Economic Optimism. Estimate 46.1 points.


*Key releases are highlighted in bold

*All release times are GMT


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.