Forex traders started December with a heavy dose of Eurozone manufacturing data that surprised to the upside but remained in the contractionary territory except for France. The testimony of new ECB President Lagarde in front of the European Parliament will also be followed and the EURUSD is expected to face an increase in volatility as the trading day progresses. What impact will this have on price action? Today’s fundamental analysis will take a look at price action in both directions.
The ISM Manufacturing PMI out of the US for November is also expected to show that the manufacturing recession is ongoing but at a slower pace. US construction spending is expected to expand, but how will the US Dollar perform after initial Black Friday shopping data showed a string improvement as compared to last year. Will bulls push this currency pair higher or will bears get enough economic data for a reversal? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Here are the key factors to keep in mind today for Euro trades:
- Spanish Markit Manufacturing PMI: The Spanish Markit Manufacturing PMI for November was reported at 47.5. Economists predicted a figure of 46.7. Forex traders can compare this to the Spanish Markit Manufacturing PMI for October which was reported at 46.8.
- Italian Markit/ADACI Manufacturing PMI: The Italian Markit/ADACI Manufacturing PMI for November was reported at 47.6. Economists predicted a figure of 47.5. Forex traders can compare this to the Italian Markit/ADACI Manufacturing PMI for October which was reported at 47.7.
- French Markit Manufacturing PMI: The Final French Markit Manufacturing PMI for November was reported at 51.7. Economists predicted a figure of 51.6. Forex traders can compare this to the previous French Markit Manufacturing PMI for November which was reported at 51.6.
- German Markit/BME Manufacturing PMI: The Final German Markit/BME Manufacturing PMI for November was reported at 44.1. Economists predicted a figure of 43.8. Forex traders can compare this to the previous German Markit/BME Manufacturing PMI for November which was reported at 43.8.
- Eurozone Markit Manufacturing PMI: The Final Eurozone Markit Manufacturing PMI PMI for November was reported at 46.9. Economists predicted a figure of 46.6. Forex traders can compare this to the previous Eurozone Markit Manufacturing PMI for November which was reported at 46.6.
Here are the key factors to keep in mind today for US Dollar trades:
- US Markit Manufacturing PMI: The Final US Markit Manufacturing PMI for November is predicted at 52.2. Forex traders can compare this to the previous US Markit Manufacturing PMI for November which was reported at 52.2.
- US Construction Spending: US Construction Spending for October is predicted to increase by 0.4% monthly. Forex traders can compare this to US Construction Spending for September which increased by 0.5% monthly.
- US ISM Manufacturing Index: The US ISM Manufacturing Index for November is predicted at 49.5. Forex traders can compare this to the US ISM Manufacturing Index for October which was reported at 48.3. ISM Prices Paid for November are predicted at 47.0. Forex traders can compare this to ISM Prices Paid for October which were reported at 45.5.
Should price action for the EURUSD remain inside the or breakout above the 1.0980 to 1.1030 zone the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 1.1015
- Take Profit Zone: 1.1180 – 1.1240
- Stop Loss Level: 1.0940
Should price action for the EURUSD breakdown below 1.0980 the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 1.0940
- Take Profit Zone: 1.0820 – 1.0855
- Stop Loss Level: 1.0980
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