Economic data from the Eurozone shows signs of a slowdown.

The euro continues to strengthen, driven by signals from U.S. Federal Reserve officials indicating a tendency towards more relaxed monetary policies. Additionally, it is supported by the Chinese government's announcement of substantial economic stimulus measures in response to the ongoing slowdown, boosting investor confidence. However, investors still anticipate further interest rate cuts by the European Central Bank, following the release of PMI data and other economic indicators that have slowed more than expected, especially as Germany's economy has rapidly decelerated.

The Eurozone's manufacturing PMI fell to 44.8 in September, down from 45.8 in the previous month, marking a contraction that has lasted nearly two years. This decline in manufacturing output is the largest in nine months, amid a clear recession in major economies such as France and Germany. The slowdown is attributed to declining new orders, coupled with rising production costs, leading companies to reduce their workforce.

Meanwhile, the Eurozone's services PMI fell to 50.5, below the forecast of 52.1. Although still indicative of expansion in the services sector, it represents the slowest growth in recent times. The decline is primarily driven by France, where new business activity decreased for the first time in seven months, amid weakening domestic and international demand. At the same time, employment growth continued, but at the slowest pace since 2023.

Dr. Cyrus de la Rubia, chief economist at Hamburg Commercial Bank, commented that the Eurozone is heading towards another period of economic stagnation. While the Olympic Games have temporarily boosted economic activity in France's manufacturing and services sectors, this increase is short-lived and does not provide sustainable economic support.

Wages in the Eurozone saw a slight increase of 4.5% year-on-year in the second quarter, leading to a similar rise in hourly labor costs. Most of the wage growth was concentrated in the manufacturing and construction sectors, while wage growth in the services sector was relatively modest.

Techical analysis data (5H)

Resistance: 0.8946, 0.8953, 0.896

Source: Investing.com

Buy/Long 1: If the price touches support in the price range of 0.8925 - 0.8932 but cannot break the support at 0.8932, you may set a TP at approximately 0.8953 and SL at around 0.8919 or according to your acceptable risk.

Buy/Long 2: If the price breaks the resistance in the price range of 0.8946 - 0.8953, you may set a TP at approximately 0.896 and SL at around 0.8925 or according to your acceptable risk.

Sell/Short 1: If the price touches resistance in the price range of 0.8946 - 0.8953 but cannot break the resistance at 0.8946, you may set a TP at approximately 0.8925 and SL at around 0.896 or according to your acceptable risk.

Sell/Short 2: If the price breaks the support in the price range of 0.8925 - 0.8932, you may set a TP at approximately 0.8919 and SL at around 0.8953 or according to your acceptable risk.

Pivot point September 25, 2024 09:21 PM. GMT+7