Euro Analysis 04.09.2019

The euro-zone single currency fluctuated in a narrow, bullish range during the Asian session to see its rebound for the second consecutive session since May 15, 2017 against the US dollar on the eve of developments and economic data expected on Wednesday by euro-zone economies The US economy is the largest in the world.

At 05:31 AM GMT the EURUSD rose 0.01% to 1.0975 levels from the opening at 1.0974, after the pair reached a session high of 1.0980, while a low of 1.0969.

Markets are looking for Spain, the euro zone's fourth largest economy, to release its services PMI reading, which may show a widening of 53.0 vs. 52.9 in July, before we see the same indicator for Italy, the region's third largest economy, which may reflect a contraction. Widening to 51.5 vs. 51.7 in July.

Investors are also waiting for France, the second largest economy in the euro zone to release the final reading of the services PMI, which may show a steady expansion at 53.3 unchanged from the initial reading of last month, compared to 52.6 in July, before the final reading of the same indicator for Germany. The economies of the region may also show a stabilization of 54.4, broadly unchanged from the previous initial reading, versus 54.5.

The final reading of the Eurozone Services PMI which may show a steady expansion at 53.4 remains unchanged from the previous preliminary reading, versus 53.2 in July, and before we also see the Eurozone economies as a whole. That could show a 0.6% decline versus a 1.1% rise in June.

On the other hand, we followed up yesterday with the European Commission saying that the prospects for a Brexit scenario are currently strong and clear, and that the assumption of a Brexit by 31 October is being worked out, with the statement that the EU does not want an exit. Britain is without agreement and it needs constructive proposals regarding the pakistani plan by the British government.

On the other hand, investors are awaiting the US economy to reveal the trade balance reading which may reflect a narrowing of the deficit to $ 54.2 billion compared to $ 55.2 billion last June. New York Fed John Williams at the Euromoney conference in New York.

Later in the day, Federal Open Market Committee (FOMC) and St. Louis Federal Reserve Chairman James Pollard will deliver the opening speech along with Fed Governor and Federal Open Market Committee member Michelle Bowman at the event hosted by the St. Louis Federal Reserve Bank in St. Louis.

This comes before we see the release of the Beige Book report, which is important in that it is issued two weeks before the meeting of the Federal Open Market Committee, which is one of the pillars on which the monetary policy makers at the Federal Reserve Bank decisions and directions to support and stimulate the US economy, knowing that the meeting The next FOMC is scheduled to be held in Washington on September 17-18.

Federal Open Market Committee (FOMC) Chairman and President of the Federal Reserve Bank of Chicago Charles Evans will deliver the opening speech at a conference on North American trade in Detroit. This comes just hours before the labor market data was released last month and Fed Governor Jerome Powell delivered a speech titled "Economic Outlook. And monetary policy "at an event hosted by the Swiss Institute of International Studies in Zurich.

Technical Analysis

EURUSD is showing some bullish bias towards the test of the 1.1005 barrier, and as we pointed out yesterday, the price needs to hold below this level to maintain the bearish scenario for the upcoming period, with its next target at 1.0857.

On the other hand, it should be noted that a break of 1.1005 will lead the price for additional gains of 1.1130 and then 1.1180 before any new attempt to decline.

Expected trading range for today is between 1.0880 support and 1.1040 resistance.

Expected trend for today: Bearish.