The Euro traded higher against the US dollar recently, as the EURUSD pair was rejected one more time around the 1.2440-20 support area. There was one more important reason for gains in the EURUSD pair. There were a couple of critical economic releases lined up in the Euro zone yesterday, including the Euro area manufacturing and services PMI, German manufacturing and services PMI and German ZEW Economic sentiment.
The outcome of all these releases was on the positive side. The best of the lot was the German ZEW economic sentiment which surged higher and registered a reading of 34.9. The Euro buyers got a reason to take it higher. The EURUSD pair climbed above the 1.2500 Intraday.
Euro Zone Manufacturing PMI
The first important release in the Euro zone was the Manufacturing Purchasing Managers Index (PMI) by the Markit Economics. The forecast was slated for a rise from the previous reading of 50.1 to 50.5. However, the outcome was above the forecast, as the Euro area manufacturing PMI came in at 50.8. Moreover, the Euro area services PMI also increased to 51.9 from 51.1. The report mentioned that business activity in Euro area grew at a slightly faster rate in December, but the pace of expansion was still one of the weakest seen over the past year.
The EURUSD pair traded higher after the release and climbed above the 1.2500 resistance area. The pair successfully managed to break an important hurdle around the 1.2480 level.
German Manufacturing PMI
The next release was German the Manufacturing PMI, which was also published by the Markit Economics. The forecast was slated for a rise from the previous reading of 49.5 to 50.4. However, the outcome was above the forecast, as the German manufacturing PMI came in at 51.2. Moreover, the German services PMI missed the mark, and registered a decline from the last reading of 52.1 to 51.4. The market was expecting it to increase to 52.5. The report mentioned that the service sector business activity increased at the slowest pace since July of last year.
The EURUSD pair was unfazed by the outcome as it continued to rise during the London session. Basically, the Euro bulls were in control as the EURUSD pair headed towards the 1.2550 area.
German ZEW Economic Sentiment
There was one more important release scheduled during the London session i.e. the German ZEW economic sentiment was released. The outcome was way above the expectation as the German ZEW economic sentiment jumped 23.4 points in December 2014 and registered a reading of 34.9. ZEW President Professor Clemens Fuest mentioned in the report that “Confidence in the German economy seems to be slowly returning among the financial market experts surveyed by ZEW”.
Technically, the EURUSD is facing yet another resistance around the 1.2600 area after the recent rise. There is no doubt that the pair was rejected around the 1.2400 area and might continue to trade higher. If the pair dips from the current levels, then the 1.2440-80 area could act as a support moving ahead.
So, keep an eye on all the important levels friends and trade accordingly.
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