After falling for six of the past seven days, it wasn’t surprising to see EUR/USD rally off its 1.1215 support level in today’s Asian session trade. Unfortunately for EUR/USD bulls, that move has turned out to be a brutal April Fool’s Day prank.
The world’s most widely-traded currency pair hit a high of 1.1250 at the start of today’s European session but could not withstand a run of weak economic data out of the Eurozone. March Manufacturing PMI figures were revised down to 47.5 (from 51.4 at the end of 2018), led by weakness in Germany and France, the region’s two most important countries. Adding insult to injury, the preliminary March CPI report also ticked down to 1.4%, while the core inflation measure dropped to 0.8%, a nearly 1-year low.
As of writing, EUR/USD has shrugged off mixed US data to extend its fall through support at 1.1215. From a technical perspective, a close here could clear the way for a continuation down toward the 21-month low at 1.1175. That said, the pair is working on its fifth consecutive bearish day, so a short-term rally cannot be ruled out. Given the established bearish momentum, we would expect bears to sell any rallies back toward the 1.1300 handle if they emerge.
Source: TradingView, FOREX.com