COZfx: EUR/USD holds gains after positive US housing data

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COZforex: The euro held gains against the US dollar on Wednesday, after the release of positive US new home sales data, although ongoing uncertainty over the future of the Federal Reserve's stimulus program still weighed on market sentiment.

EUR/USD hit 1.3520 amid US trade, the pair's highest since Monday; the pair subsequently consolidated at 1.3501, adding 0.20%. COZforex senior currency strategist Ian • Quigley said, EUR/USD is predicted to find support at 1.3445, and a drop through could take it to the next support line of 1.3424. Meanwhile, the pair is predicted to find its first resistance at 1.3504, and a rise through could take it to the next resistance line of 1.3542.

In a report, the Census Bureau said that US new home sales rise 7.9% to a seasonally adjusted 421,000 units in August, from a downwardly revised 390,000 the previous month. Analysts had expected new home sales to rise to 420,000 units last month.

A separate report showed that US core durable goods orders, excluding transportation items, declined 0.1% in August, disappointing expectations for a 1% increase, after an upwardly revised 0.5% rise the previous month. Durable goods orders in the US rise 0.1% last month, compared to expectations for a 0.2% increase, following a downwardly revised 8.1% decline in July.

The euro found support earlier; after data showed that German consumer confidence is seen rising to the highest level since June 2007 in October. The forward looking GfK index of German consumer confidence rise to 7.1, and this month’s reading was revised up from 6.9 to 7.

Also Wednesday, a report compiled by the Confederation of British Industry showed that its retail sales index rise to 34.0 in September from 27.0 last month, the highest level since June 2012.

(COZ forex UK)