EUR/USD at 1.0862. Moody’s downgraded the Chinese government debt.

EUR/USD continues to trade within the yesterday range during Asian session today. As of 3:00 AM EST the pair was trading at 1.0862, down 0.05%. US dollar strengthened during this week driven by strong fundamentals, such as Q4 GDP, PCE index and ISM manufacturing PMI. On the other side, the Euro weakened due to negative CPI data from the Eurozone.

The EUR/USD immediate resistance level stands at 1.0894/1.0898 (5 & 100-DMA), a break beyond which will move the rate down to 1.0932/45 (daily R2/ 1h 100-SMA). On the other side, the immediate support is located at 1.0835 (4 week low).

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Barclays provided a bearish outlook on this currency pair today. “A weekly close below the 1.1020, 52-week average would point lower toward initial targets in the 1.0850 area and then the 1.0710 year-to-date lows. Our greater targets are toward 1.0460 and then the 1.0215 area” said Hamish Pepper, a strategist from Barclays.

Asian markets jumped today. The major indices had the following performance:

  • Shanghai Composite climbed 4.26% closing at 2,849.68.
  • Nikkei 225 finished the session at 16,746.55, up 4.11%.
  • Hang Seng gained 3.07% closing at 20,003.49.

Today Moody’s downgraded the outlook on Chinese government debt from “stable” to “negative”.

“Without credible and efficient reforms, China’s GDP growth would slow more markedly as a high debt burden dampens business investment and demographics turn increasingly unfavorable. Government debt would increase more sharply than we currently expect,” said in the report.

Oil prices slightly declined today. As of 2:52 AM EST the WTI Crude was trading at $34.06 down 0.99% and Brent Crude at $36.73 (-0.22%).

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I’m a finance specialist with 4+ years of working experience, out of which 2 years as a SME relationship manager at Byblos Bank and 2 years as a Finance Director in a Food & Beverage sector. My academic background include BA in economics, MA in finance, CFA Level 1 and F1, F2, F3 level of ACCA. I’m also experienced in Forex/CFD trading and Forex/ Equity markets analysis.

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