On Monday, the main currency pair is trading without any particular direction; the market has no desire to both buy and sell.
The beginning of the new week is quite neutral. The Eurodollar attempted to strengthen the Asian trading session, but no meaningful ideas appeared during the European trading session as well. The main currency pair is moving around 1.1205; activity is close to zero.
Today’s statistics indicated that the activity in the private sector in the Eurozone in May decreased significantly and move close to the minimum of the last 16 months. The indicator was 52.9 points against the predicted number of 53.2 pints and 53 points previously in April. The components of the report show that the Purchasing Managers' Index didn’t change and remained at 53.1 points, although it was predicted to increase. According to preliminary calculations, in May the PMI in the manufacturing sector decreased up to 51.5 points against 51.7 points previously.
This data is not too important, but it provides skeptics with an opportunity to say that the growth impact that we saw at the beginning of the year may be just a glimpse of optimism. It’s quite interesting that the business activity index in Germany and France was quite positive, and this is another indication that the European economy is rather different and there might be some hidden risks.
So far, the Eurodollar hasn’t retreated under 1.12. There is a significant support near 1.1180, but “bears” may break it easily if necessary. With a lack of some essential statistics, investors will look through any comment to find hints to what the USA FRS may do in June.
RoboForex Analytical Department
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