Yesterday, the demand for the US dollar slowed down near major support levels after a weak report signaling that industrial production in the United States declined in March of this year. The pressure on the US manufacturing sector is directly related to the slowdown in global economic growth.
As indicated in the report by the US Federal Reserve, industrial production in March fell by 0.1% compared with the previous month, while economists had expected industrial production to grow by 0.2%. Compared with March of the previous year, industrial production increased by 2.8%.
Let me remind you that the report of the International Monetary Fund was recently published, in which economists noted a direct link between the fall in growth rates of industrial activity and tension in international trade.
Data on retail sales in the US provided only temporary support to the dollar.
According to the report of Retail Economist and Goldman Sachs, sales in US retail chains for the week from April 7 to 13 increased compared to the same period of the previous year. Thus, the retail sales index for the week rose by 2.0% compared with the previous week and by 3.3% compared with the same period of the previous year. Growth is directly related to Easter.
Retail sales according to the Redbook for the first week of April increased immediately by 5.0% compared to the same period in 2018. For the week from April 7 to April 13, sales also increased by 5.0%.
A good report on the growth of sentiments in housing builders in the United States also supported the dollar. Growth over the past three months is a good signal. According to the National Association of Home Builders (NAHB), the housing market index in April this year rose to 63 points, which completely coincided with economists' forecasts.
The NAHB noted that continued job growth and low unemployment will contribute to moderate sales growth in the short term. The Freddie Mac report states that the average fixed rate for 30-year mortgage loans in March was 4.27% versus 4.87% in November, which is also good news for borrowers.
As for the technical picture of the EURUSD pair, despite all the attempts of the bears to resume the downward trend, buyers of risky assets are rebuffing them. The key target for the bulls is the resistance around 1.1310, the breakthrough of which can lead to a number of euro purchases. The target will be the highs of 1.1350 and 1.1390. In the scenario of the formation of the upper limit from the resistance of 1.1320, sellers will return to the market, which can lead to a repeated decrease in the trading instrument in the lower border of the channel 1.1280.
The material has been provided by InstaForex Company - www.instaforex.com