More evidence of a weakening EURUSD pairGermany's construction PMI was recorded yesterday at an 8 month low of 53.4, down from 54.9. This means that a little over half, and shrinking, purchasing managers have positive sentiment. To me, these indicators provide good guidance as to the overall direction of the markets. Germany's PMI wasn't the only indicator that released down. Construction output was also down, confirming the sentiment in the PMI, as well as home ownership.
Germany is the world's fifth largest economy, according to the CIA World Factbook, and Europe's largest. Because of this, I think it's healthy to keep an eye on Germany. A slow down here, fundamentally, can indicated a slowdown in Europe overall, weakening the EUR/USD pair.
Pair this fundamental information with the technical breakdown of the pair, a lower RSI range and a minor consolidation forming, and the fact that the DXY is gaining strength as well as the US economy, and I think you have good evidence of a weaker pair in the future. I am personally going to look to short and watching it as it approaches the 1.14 level. That's where I think it is headed. I'll probably allocate 5% of my portfolio to this move down, for the mid to long term.
