FXstreet.com (Barcelona) - Today marks the 10th trading day the Euro/U.S. Dollar rate has been trapped within the 1.3260-1.3400 parameters, which means the short term technical theme continues to develop well-defined. The lack of top-tier fundamental news this week has only helped to agonize the dull action, with price in need for a technical breakout to clear up the next possible bias.
Is there any upcoming event that may potentially change the near-term fate for either the Euro or the U.S. Dollar? Traders may have a chance today, as key Eurozone economic reports will be published during the European morning.
According to Kathy Lien, co-founder at BK Asset Management: "Concern about Eurozone growth is why the PMI numbers are so important because they will provide a more accurate assessment of actual business activity. Both service and manufacturing sector PMI are expected to increase which would lend support to the euro. However, if the PMI reports show a deeper contraction, the EUR/USD could break its range low of 1.3264."
In the U.S., benchmark indices continue to climb to fresh 5-year highs, which puts some slight pressure on the U.S. Dollar, following the approval by the U.S. House of Representatives to suspend the debt ceiling deadline until May 19.
As the FXstreet.com fundamental team notes: "Harry Reid, majority leader of the Democratic-led Senate, said on Wednesday the upper chamber will pass the short-term extension as soon as possible. The White House has also indicated it will support the bill. The May 19 extension will temporarily ease tensions and give the two parties more time to seek a long-term deal.
Technical readings in EUR/USD, according to Valeria Bednarik, chief analyst at FXstreet.com, are slowly turning bearish:
"While technical readings remain neutral the pair looks heavier as time goes by: lower highs daily basis are limiting the upside now with a short term descendant trend line currently around 1.3350. While the level should limit the upside, is still required a break below 1.3250/60 to confirm further falls up to 1.3180 price zone."
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.