The Euro (EUR) inched lower against the US dollar (USD) on Tuesday, decreasing the price of EURUSD to less than 1.0550, following the release of some key economic news. The technical bias remains bearish because of the lower low and lower high in the recent downside move.

Technical Analysis

As of this writing, the pair is being traded around 1.0549. A support can be noted around 1.0500, the confluence of psychological number as well as critical support zone. A daily closing below the 1.0500 support area shall incite renewed selling pressure, validating a move towards the 1.0350 support zone in short to medium term.

On the upside, a hurdle can be noted near 1.0832, the confluence of trendline resistance area as well as 50% fib level as demonstrated in the given above daily chart. A break and daily closing above the 1.0832 resistance shall incite renewed buying interest, validating an upside rally towards the 1.0900 resistance zone.

Germany Services PMI

The Markit February German flash PMI index for the manufacturing index rose to 57.0 from 56.4 the previous month. This was above expectations of a slight decline to 56.2 and the highest reading for 69 months. The services PMI index was also above expectations at 54.4 from 53.4 the previous month and the highest reading for three months. The composite output index strengthened to a 34-month high of 56.1 from 54.8 the previous month. The index of output expectations also increased to the highest level since the series was first calculated in July 2012 with expectations in the services sector the strongest in six years.

Trade Idea

Considering the overall technical and fundamental outlook, selling the pair around current levels appears to be a good strategy in short to medium term.