The last trading session went bad for the EUR/USD pair due to the release of China’s trade data, which turned out to be extremely lower than expected, with the data showing that the nation’s exports were the most affected sector. The trade data has now led to investors becoming uncertain with regards to the state of the Chinese economy, especially since the Chinese market is one of the largest markets in the world and any movement would certainly affect all major economies. As a result, the Asian stock markets experienced a significant decrease, as well as the S&P500 for the region. Meanwhile, the USD increased its trading value, causing the EUR/USD to reach support levels at 1.1000 points.
The selling for the pair increased in activity which caused the pair to hit support at 1.1000, even going as far as 1.0985. However, the currency pair eventually recovered from the support level and went up to 1.1050 points, with the pair now at the 1.1054 trading range.
Market players are now expecting increased volatility with regards to this currency pair due to the Fed’s statement which is scheduled to be released within the day, as well as the retail sales data to be released from the US. The pair could possibly go into reversal but is expected to immediately get back to its previous trading range during the session.
Andrea ForexMart, Official Representative