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In early morning trading the EUR/USD continues to use the 50-day moving average as a crutch, as currency traders wait for the flood of economic data to start.
The EU, like the UK, has used consumer spending as one of its aids to help spend its way out of the economic doldrums. Unfortunately for the EU, German spending has failed to move on from its lethargy, and it is hoped that this morning’s monthly retail sales figures will start to rectify this. The real interest for the day heats up around 1.30pm (London time), as the European Central Bank press conference commences and they announce both the latest EU trade balance figures along with the unemployment claims. At 3pm (London time) ECB president Mario Draghi will start speaking, which coincides with the release of the US ISM non-manufacturing purchasing managers index data.
Although the short-term movements in EUR/USD will be driven by today’s economic data, the longer/medium-term outlook still points to the $1.38 level being tackled and a fresh test of the last twelve-month highs set in mid-March.