The EUR/USD bounces back in the face of european PMI data better than expected

© O Financista.

By David Wagner

Manufacturing PMI indexes were better than expected for France and Germany benefit from the Euro Friday morning, the pair EUR/USD attempting a return above the threshold of 1.08, close to the peaks of the previous day.

The manufacturing PMI of Germany for the month of February has shown a surprise increase to 47.8 points from 44.8 in advance and 45.3 above, while that of France has climbed to 51.9 points against 51 expected and 51.1 previously.

The indices of the services, however, have disappointed, to 53.3 versus 53.8 expected for Germany, and in at 49.7 versus 50.7 expected for France, but not enough so that the PMI composite are shown under the consensus.

The same indices for the euro area as a whole, which are due at 10am, expected to confirm the trend suggested by the clues in German and French, which could further support the Euro, but it should not be forgotten that several other events will be likely to influence the exchanges by the end of the day.

At 11, we will monitor, in effect, the CPI in the euro area, before the PMI indexes are preliminary for the month of February for the United States at 15: 45, and then existing home sales US 16.

In regards to the impact on the EUR/USD, it should be noted that the rebound this morning is encouraging, but it will take a lot more to question the current bias is bearish, as the Euro is in the process of completing its third consecutive week of sharp decline.

In fact, only a return above 1.09 would weaken really the dominance of the sellers, and would consider a return to 1.10, the threshold above which a bullish reversal sustainable would be possible.

In the meantime, it is not excluded to consider the rebound of the Euro as selling opportunities.

Finally, if the single currency shows further losses, first support to consider will be the low of yesterday at 1.0777, prior to 1.0750, then the psychological threshold of 1.07.

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