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EUR/USD trading soft and vulnerable

FXStreet (Barcelona) - EUR/USD is trading at 1.2647, down -0.82% on the day, having posted a daily high at 1.2769 and low at 1.2640.

EUR/USD is pressing on lower and challenging the middle of the handle post a another surge in the greenback with yields stabilising and a better performing open on Wall street today. The Eurozone data however was the clincher. The German investor numbers were highly alarming. The issues following give markets a real cause for concern bringing the “R” word into question. Marc Chandler, Global Head of Currency Strategy at Brown Brothers Harriman explained the data in detail...

“First, inflation data from France, Spain, and Italy were softer than expected. French September CPI fell 0.4% for a 0.3% year-over-year pace. The consensus called for 0.3% decline and a 0.4% year-over-year pace. Italy recorded outright deflation for the second consecutive month (-0.2% year-over-year against expectations for a -0.1% pace). On the month, Italy's CPI fell 0.4%, which was a little more than expected. Despite a mostly seasonal 1% rise in September prices, Spain's year-over-year rate was unchanged at -0.3%...Euro area industrial output was weaker than anticipated. It was undermined by the whopping 4% decline in German output that had already been reported.. However, at -1.8%, the aggregate reading was weaker than expected (-1.6%), and the July series was revised lower to 0.9% from 1.0%. This was enough to bring the year-over-year rate to -1.9%, which was more than twice the decline expected and the July pace was cut to 1.6% from 2.2%."

EUR/USD noteworthy levels

With spot trading at 1.2647, we can see next resistance ahead at 1.2654 (Hourly 200 SMA), 1.2661 (Daily Classic S1), 1.2676 (Hourly 20 EMA), 1.2693 (Hourly 100 SMA) and 1.2711 (Daily Classic PP). Support below can be found at 1.2644 (Weekly Classic PP), 1.2640, 1.2630, 1.2621 and 1.2570 (Daily Classic S2).

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