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The EUR/USD pair rose on Monday morning as the market reacted to Sunday’s election in France. It rose to a high of 1.0761, higher than last week’s low of 1.0670 as the focus now shifts to key economic data.
France election and key economic data aheadThe EUR/USD exchange rate rose slightly after the latest French election. While the right-leaning Rassemblement National party won the election, the victory was less than expected.Looking ahead, Emmanuel Macron’s party and the center-right Republicans will likely form a coalition in the coming days. The election came a few weeks after Macron’s party lost the European elections.The next important catalyst for the EUR/USD exchange rate will be the upcoming European and US manufacturing PMI numbers, which will provide more information about the sector and the economy.Economists expect the ISM manufacturing PMI rose slightly from 48.7 in May to 49.2 in June. A PMI reading of below 50 is usually a sign that an economy is contracting.The figure by S&P Global is expected to show that the manufacturing PMI improved from 51.3 to 51.7 in June.In Europe, based by the flash estimate released two weeks ago, the expectation is that the manufacturing PMI dropped from 47.3 to 45.6 in June. These numbers mean that the bloc’s manufacturing sector is still contracting.Germany will also publish its preliminary inflation report on Monday. Economists expect the data to show that the country’s headline CPI retreated from 2.4% to 2.3% in June.The Eurostat will then release the bloc’s inflation report on Tuesday. Economists see the number coming in at 2.5%, down from 2.6% in May. An improvement will likely push the ECB to continue cutting rates.
EUR/USD technical analysisThe EUR/USD pair has been in a downward trend since Emmanuel Macron called for a new election in France and after the ECB started cutting interest rates. It then found a strong support at 1.0667, where it failed to move below in June.The pair has moved above the 50-period moving average after the French election. Oscillators like the Money Flow Index (MFI) and the MACD have all pointed upwards.Therefore, the pair will likely continue rising as buyers target the key resistance point at 1.0800 after the latest French election.More By This Author:BTC/USD Forex Signal: Is this Bitcoin Rebound a Dead Cat Bounce?GBP/USD Forex Signal: Moderately Bullish Above 1.2700EUR/USD Forex Signal: Double-Bottom, Bullish Divergence Pattern Forms
