How to trade the JPY?
Happy Friday, traders! Are you ready to trade at the end of the week? Here’s what you need to know before you start:
European Economy Is Shaking
What is happening?
Germany will release the flash Purchasing Managers’ Index (PMI) on March 24, at 10:30 MT time (GMT+2). It’s an index based on purchasing managers’ surveys in the manufacturing and services industries. All numbers above the 50.0 level indicate industry expansion; numbers that are below the level show contraction. The market hasn’t seen a manufacturing index below 50.0 for 18 months, but it’s far from the historical highs of March 2021. Services PMI is also in the expansion zone, but the EU’s rising prices and supply shortages will greatly affect further readings.
What is happening with the euro?
PMI data might be released months ahead of the official data. That’s why the PMI surveys are considered to be one of the world’s most market-moving economic data releases. Geopolitical tensions and wars never take a toll. The economic activity decrease can’t help but to affect the PMI data.
The PMI may fall in this month and continue to decrease later. It will push the euro lower due to the economy weakening. EURUSD is at its lowest since 2020. The US Fed’s rates hike and low PMI numbers may put USD into a stronger position, pushing the chart lower to 1.0600.
How to trade on PMI readings?
As PMI is the essential index, it may influence all EUR pairs greatly. To catch a significant price movement, you can follow other news related to EUR and analyze all the events comprehensively.
- If the actual numbers beat expectations – EUR will rise.
- Otherwise, it might fall.
Check Economic Calendar.
Instruments to trade: EURCHF, EURUSD, EURJPY, EURCAD.
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