Article by ForexTime
The EUR/USD moved lower on Wednesday following a softer than expected composite purchasing manager’s index for September. The exchange rate continued to trade below resistance near the 50-day moving average, after falling through trend line support that connects the lows in August to the lows in September. The next level of target support on the currency pair is seen near trend line support at 1.10. Momentum on the currency pair is negative with the MACD (moving average convergence divergence) index recently generating a sell signal.
The EU PMI fell to 54.0 in September from 54.3 in the previous month. The manufacturing reading dropped to 52.0 from 52.3 and the services to 54.0 from 54.0. Readings are broadly in line with our forecast, but slightly below consensus. The overall numbers remain firmly above the 50 point mark, thus pointing to expansion across both sectors.
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