EUR/USD touches a low of 1.1345 on the day
It’s a case of a slow and steady grind lower for EUR/USD over the past two days and we’re seeing more of that this session as well. The pair now touches a low of 1.1345 and is looking towards the year’s low of 1.1301. Barrier options are touted to be in place at 1.1300 so look out for some defense around the region if we start moving there later.
There is a key risk event to come in the form of the US advance Q3 GDP reading so I reckon traders won’t be accelerating the pace of the drop here until that is out of the way. A solid reading will open up the way for a move to retest the year’s lows but I’d also be inclined to sell the pair if a downbeat reading helps to see some correction/retracement.
Eurozone economic data has been lacking recently and with Italy’s budget situation still unresolved, there’s good reason for gains to be limited in the euro for now aside from positioning data. Oh, and not to forget that there’s local elections in Germany as well where Merkel’s CDU is expected to lose further ground in the German political landscape as Hesse will go to the polls on Sunday.