Daily Analysis EURUSD - 24 July 2023

The preliminary estimate revealed that the Germany Composite PMI declined to 48.3 in July 2023 from June's 50.6, falling below the expected 50.3. This indicates the first contraction in private sector activity this year and the most significant downturn since November. The decline is attributed to a sharp drop in manufacturing production since May 2020, mainly due to decreasing demand for goods.

Similarly, the HCOB France Composite PMI dropped to 46.6 in July 2023 from June's 47.2, falling short of the projected 47.8. This points to the most substantial contraction in private sector activity since November 2020, with both manufacturing and services output experiencing a decline for the second consecutive month.

As the week progresses, there is an upcoming ECB meeting where the market anticipates a 25 bp hike, potentially raising interest rates to 4.25%. However, it's worth noting that last week, ECB members hinted that after this rate increase, further actions are uncertain or not guaranteed.

The EUR/USD continues the selloff towards the lower parallel of the current bearish channel at the 1.1085 support level. A breakout of this level may take the price to the next target around the 1.1045 support level.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.1400	1.1300	1.1250	1.1085	1.1046	1.1000