IFO follows ZEW in showing worse than expected German business sentiment: IFO Business Climate drops to 109.7 points. Current Assessment dropped to 114.8 points and Expectations all the way from 106.2 to 104.8 points. The German IFO Business Climate for June was expected to tick down from 110.4 to 110.2 points. The Current Assessment component was predicted to tick up from 114.8 to 115 points and the “Expectations†figure carried estimations for a drop from 106.2 to 105.9 points.
EUR/USD managed to retake the 1.36 level before the publication and is now falling below this line. So far, there seems to be no danger to the 1.3585 support line. Nevertheless, the publication shows that Germany isn’t strong enough to pull the euro-zone forward.
Update: After the initial dip, EUR/USD recovers. Has the “buy the dips†mentality returned?
Here is the article on how to trade the IFO with EURUSD.
IFO is considered to be Germany’s No. 1 Think-Tank. However, the ZEW institute publishes its business sentiment before IFO. The ZEW figures disappointed with yet a drop in sentiment. Yesterday’s purchasing managers’ indices weren’t too kind to the euro-zone economies.
EUR/USD managed to rise after the dovish FOMC stance from the US, but it is important to note that the euro was unable to fully capitalize on the weakness of the US dollar.
Support awaits at 1.3585, which is a clear separator of ranges. Resistance is at 1.3650. For more, see the EURUSDÂ forecast.
