The Markit PMI indices came out weaker than last month and expectations, but the reaction in the EURUSD is little. The Philly Fed index came out a weaker as well at 24.5 after the surge to 40.8 last month. All the major components were lower with Employment falling to 7.2 from 22.4. This is the lowest reading since April. New orders is the lowest in 4 months. November seemed to be an aberration but this report was not so hot.
Philly Fed Index
The EURUSD has held it’s own, however. It is not going down, but it is not rising either. There could be some short covering but it seems the markets reaction since the FOMC statement and press conference is focused on Fed tightening in 2015. Meanwhile the ECB is leaning toward adding more stimulus. That should spell a lower EURUSD.
EURUSD on the hourly is back below the November floor. Is the 3rd time a charm?
Technically, the pair has been able to stay below the November lows at the 1.2357-59 level today. The high price in the Asian session could only get up to the 1.23512. So sellers are in control. The pair has ventured two other times below this floor in December. Will the 3rd time be the charm and lead to a further downside push before the end of the year? There is a chance.
The 50% of the EURUSD move up from 2000 low is at 1.2131.
If the price does go down, let me remind everyone that the 50% of the EURUSD lifetime range (from January 2009 start) comes in at the 1.2131 area (see chart above). Are the Fibonacci magnets pulling the price toward that level? Is this the magical and mystical vortex for the pair? Time will tell.
In the mean time, looking at the 5 minute chart below, the 100 bar MA (blue line) and the 38.2-50% of the days range is as good as any level for the risk defining level for intraday risk today. You want to see sellers remain in control if you are looking for lower levels, and this would be an area that would tell me, the sellers are remaining in control.
EURUSD on the 5 minute chart.
