EURUSD: the level of business activity in Eurozone has started to improve
The EURUSD trading pair is in a corrective trend and is keeping close to 1.0981.
The single currency in Europe is influenced by contradictory factors due to the published earlier macroeconomic data in the EU. Thus, business activity of the manufacturing sector in Germany declined from 44.7 points to 44.0 points in April, while the service sector value increased from 53.7 points to 55.7 points, which allowed the composite index of the manufacturing sector in the euro area to shift to the downward correction from 47.3 points to 45.5 points, business activity on the S&P Global Composite Index was 54.4 points against the previous 53.7. Today the release of key indicators of the evaluation of the current situation and business sentiment in Germany was announced, where analysts forecast positive dynamics.
- Resistance levels: 1.1050 and 1.1200.
- Support levels: 1.0920, 1.0750.
GBPUSD: pound holds the current levels
GBPUSD is showing mixed sentiment, not moving away from 1.2435, waiting for signals for a move. At the end of the previous week the "Briton" went into moderate strengthening, entering the "green" zone to the opening positions of last Monday.
The macroeconomic data from Great Britain, published at the end of the week, could not provide the expected support to the pound. For instance, retail sales for March lost 0.9% from a previous increase of 1.1% for February, against analysts' estimates of -0.5%, while the annual value reduced the downward momentum to -30.0 points from -36.0 points, beating market expectations of -35.0 points. Meanwhile, the business activity of the services sector index of S&P Global for April strengthened to 54.9 points from 52.9 points, and the composite index of S&P Global/CIPS strengthened to 53.9 points from 52.2 points, though experts expected the correction in the area of 52.5 points.
- Resistance levels: 1.2450, 1.2500, 1.2550, 1.2600.
- Support levels: 1.2400, 1.2350, 1.2283, 1.2236.
NZDUSD: New Zealand currency made a new low
The currency pair NZDUSD is under a moderate decline, strengthening the advantage of the "bears" in the asset, which came the day before, which allowed the instrument to reach the local lows of March 10. The pair is testing the level of 0.6130, while investors are waiting for the forthcoming meeting of the US Federal Reserve. Experts give 90% probability that the regulator will announce a 0.25% increase in the cost of borrowing at the end of the meeting and then take a break.
The market remains at a low activity level at the beginning of the trading week amid the closed New Zealand markets due to the national holidays. In turn, the macroeconomic publications calendar is clear today in the USA as well, which allows investors to win back Friday's data.
Thus, the U.S. manufacturing sector business activity from S&P Global showed a strong strengthening to 50.4 points from 49.2 points, contrary to expectations of a decline to 49.0 points, while the service sector showed a correction to 53.7 points from 52.6 points, contrary to analysts' expectations of a decline to 51.5 points. Business activity in the composite index for April strengthened to 53.5 points from 52.3 points, surpassing the experts' estimate of 52.8 points.
- Resistance levels: 0.6150, 0.6200, 0.6250 and 0.6300.
- Support levels: 0.6100, 0.6049, 0.6000, 0.5938.
USDCHF: pair expects new stimulus
During the Asian trading session USDCHF instrument demonstrates a contradictory dynamics, holding positions at 0.8929.
Economists are estimating the macroeconomic background, trying to forecast the risks of economic recession in the USA. The additional problem with the potential for development is the standoff between Republicans and Democrats on the issue of the national debt limits, because the acting leader Joe Biden stands for the increase of the upper limit of the acceptable debt level without any conditions, and the Republican wing insists on the reduction of the expenditure part in the budget in order to slow the active growth of the debt load.
- Resistance levels: 0.8960, 0.9000, 0.9030, 0.9070.
- Support levels: 0.8900, 0.8858, 0.8800, 0.8756.