EUR/USD longs were riding high last week as the pair consolidated recent gains above the 200-DMA, but bulls are now in need of a helping hand.
June manufacturing PMIs from the euro zone show persistent contraction in Germany nS8N22E032 and the entire bloc nS8N22E034.
As a result German Bund yields have traded to new lows, German-U.S.
yield spreads have tightened and chances for ECB cuts have increased ECBWATCH while EUR/USD dipped below the 200- and 10-DMAs to give daily techs a bearish bias.
The eased U.S.-Sino trade tensions resulting from the G20 are also a concern for EUR/USD longs as risk sentiment shifts up, which helps reduce the chances for Fed cuts FEDWATCH.
Today's June ISM manufacturing headline nN9N23A007 beat did little to help EUR/USD longs but the subcomponents might dilute bearish reaction.
Prices paid and new orders came in below estimates.
The ISM employment index improved from May though and came in above estimates for June.
The jobs component will now put extra emphasis on Friday's U.S. June employment report.
EUR/USD longs need downside misses to estimates for NFP and AHE to weaken the greenback and increase chances of Fed cuts.
Weak results could help propel EUR/USD above June's high and lead to 1.1450/60 and 1.1515/20 tests.
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