Two trades to watch: EUR/USD, Dax

EUR/USD resumes sell-off ahead of PMI data & EZ PPI . Dax attempts a rebound ahead of PMIs.

EUR/USD resumes sell off ahead of PMI data & EZ PPI

EURUSD is edging lower snapping a two-day winning run as the US Dollar rebounds on safe haven flows and rising treasury yields.

US treasury yields remain elevated around 1.50%

Attention will turn to Eurozone composite PMI September which is expected to confirm 56.1 flash reading. Down from 59 in August.

Eurozone PPI is expected to reveal 1.3% MoM increase, down from 2.3%. However, annually PPI is due to rise to 13.5%, up from 12.1%.

US ISM services PMI will also be under the spotlight, particularly the employment and prices sub-components.

Learn more about the Euro

Where next for EUR/USD?

EUR/USD has been trending lower since the start of September. It trades below the descending trendline, 50 & 100 sma.

The RSI is supportive of further downside, whilst it remains out of oversold territory.

Support can be seen at 1.1560 last week’s low. A break below here could open the door to 1.15 round number and high March 9 2020.

It would take a move over 1.1655 the confluence of the 50 sma and the falling trendline and 1.1664 horizontal support turned resistance for bulls to take back control

EURUSD chart

Dax attempts a rebound ahead of PMIs

Stocks and futures across the board are heading cautiously higher on Turnaround Tuesday. Bargain hunters are out after yesterday’s steep selloff.

Several headwinds such as concerns over rising energy prices keeping inflation elevate, supply chain disruptions, labour shortages coming at a time when central banks could start tightening monetary policy unnerved investors. These headwinds remain and could cap gains today.

German services and Composite PMI data will be in focus and is expected to confirm the flash estimates of 56 and 55.3 respectively, down from 60.8 and 60.

Learn more about the Dax

Where next for the DAX?

The Dax has been trending lower since the start of the month. It trades below its 50 sma on the daily chart and below the falling trendline. The RSI is supportive of further downside.

The index is currently testing the 200 sma at 15060. A move below this level and 15000 the psychological level and the weekly low could open the door to 14820 the May.

It would take a move over 15450 the high September 30 to facilitate a move towards 15680 the 50 sma and falling trendline.

DAX chart


How to trade with City Index

Follow these easy steps to start trading with City Index today:

  1. Open a City Index account, or log-in if you’re already a customer.
  2. Search for the market you want to trade in our award-winning platform.
  3. Choose your position and size, and your stop and limit levels
  4. Place the trade.



Build your confidence risk free
Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.