EUR/USD is now down 0.2% on the day to 1.0832 and looks poised for a further decline, at least from the charts. The dollar has been holding up better this week and the more sluggish risk mood is also helping with that in trading today.
EUR/USD daily chart
Looking at the chart above, EUR/USD now looks on course for a push towards its 200-day moving average (blue line) next. The key level is seen at 1.0816 with the 100-day moving average (red line) not too far away at 1.0798 currently.
And a beat on the US PMI data later today could very well bring those levels into play.
Otherwise, traders will have to look for other factors to work with on the week. And they don’t have to look too far. Risk sentiment is on the defensive and that’s also a fuel for the dollar to some degree.
The DAX is down 0.9% and the CAC 40 down 1.5% currently. Meanwhile, S&P 500 futures are down 0.7% with Nasdaq futures down 1.0% on the day.
Despite the PMI readings, it’s still not a given that the ECB will be cutting rates in September. They want to, of course, but inflation data will be the main tell. And so, the wait continues. Currently, traders are pricing in ~61% odds of a rate cut in September.
