Dollar drops before manufacturing report

The greenback has fallen ahead of the US manufacturing PMI update this afternoon. 

Source: Bloomberg

Euro shrugs off poor PMI reports
The euro is trading higher despite the disappointing manufacturing and services purchasing managers index (PMI) reports from the eurozone this morning. The earlier reports from France and Germany also missed market estimates, so it was a given that the entire region will yield poor figures.

We are not expecting any more economic announcements from the eurozone today, but the meeting between Angela Merkel and Alexis Tsipras today will set the tone for the Eurogroup meeting tomorrow. Athens is still playing hardball with its creditors, and all the while Greece refuses to meet eye-to-eye with the rest of the Eurozone. Any advances in EUR/USD will be limited.

The 200-hour moving average (MA) is providing support at $1.069.7 If this mark is held, it will bring the resistance at $1.0770/80 into play, and a move through that level will put $1.08 on the radar. A drop below the 200-hour MA will bring the support at $1.0660 into play, and if that level is punctured traders will look to $1.0625 and then $1.06. 

GBP/USD flirts with $1.50
The pound is dancing around the $1.50 mark as the market awaits the US manufacturing PMI report at 2.45pm (London time). The consensus is for a reading of 55.6, and that compares with the March reading of 55.7, we will see short-term selling should the report exceed estimates. As I previously stated, the pound’s time spent above $1.50 is short lived and the UK general election is only two weeks away, and all signs are pointing to a hung parliament which will keep GBP/USD in its long-term downward trend.

We’re seeing $1.50 acting as support for now, and the resistance in the $1.5030/35 region will be the initial upside target. Beyond that traders will look to $1.5080. A fall back below $1.50 will bring the 50-hour moving average at $1.4980 into sight, and then $1.4930 will provide the next level of support and then $1.49 will come into play. 

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