The Euro (EUR) extended upside movement against the US Dollar (USD) on Wednesday, increasing the price of EURUSD to more than 1.1280 following the release of some key economic reports. The sentiment remains bullish in short term because of a Higher High on daily chart.
As of this writing, the pair is being traded around 1.1289. A support may be noted around 1.1258, the 50% fib level ahead of 1.1151, the 61.8% fib level and then 1.1100 that is the psychological number as demonstrated in the following chart.
On the upside, the pair is expected to face a hurdle near 1.1365, the 38.2% fib level which is also the high of last major upside move ahead of 1.1498-1.1500 area that’s the confluence of psychological number as well as 23.6% fib level.
Zew Economic Sentiment
In its latest survey of financial forecasters, the ZEW economic expectations index for September showed a drop to 12.1 from 25.0 in August. ZEW President Clemens Fuest attributed the fall to a worsening economic outlook in the developing world. ZEW’s current conditions survey did however showed a slight bounce to 67.5 in September from 65.7 the month before and against expectations of a retreat to 64.0
Eurozone Trade Balance
For the whole of the European Union of 28 countries, the unadjusted trade surplus was €12.9 billion in July compared to €1.2 billion the year before. As a result, the European Union trade balance with South Korea, which had constantly been in deficit from 2004 to 2012, has turned into a surplus for the last two years and stood at +EUR 4.1 billion in both 2013 and 2014, informs LETA/ELTA.
Considering the overall technical and fundamental outlook, selling the pair around current levels could be a good strategy in short term before the Fed monetary policy.