EUR/USD drops to lows in the 1.1680/75 band ahead of PMIs
- The pair loses momentum and tests lows near 1.1670.
- The greenback trades on a better mood and approaches 94.70.
- Final July’s PMIs coming up next in the euro bloc.
Renewed escalation in the US-China trade spat is giving fresh legs to the buck and is forcing EUR/USD to recede further to the area of daily lows in the proximity of 1.1670.
EUR/USD looks to data, ISM, FOMC
After briefly testing the key resistance line around 1.1735 on Tuesday, sellers quickly stepped in a dragged spot lower, breaking below the key support area at 1.1689, where sits the 21-day SMA.
The greenback gathered extra pace after the White House announced it could increase tariffs on US imports from China from 10% to 25% in the next round worth of $200 billion.
Looking ahead, final manufacturing PMIs in Euroland are expected to fall in line with the preliminary readings. Across the pond, the ISM manufacturing will be the salient event preceding the FOMC meeting, where the Fed is seen keeping its monetary policy on hold.
EUR/USD levels to watch
At the moment, the pair is down 0.09% at 1.1681 facing immediate support at 1.1625 (low Jul.27) followed by 1.1575 (low Jul.19) and then 1.1527 (low Jun.28). On the upside, a breakout of 1.1749 (high Jul.23) would open the door to 1.1792 (high Jul.9) and finally 1.1853 (high Jun.14).