EUR/USD drops below 1.19 as DXY edges higher towards 93

The EUR/USD pair remains under pressure in the late NA session, pushing lower to a fresh daily low at 1.1885. As of writing, the pair was trading a couple of pips above that level, recording a daily loss of 85 pips, or 0.72%.

Although the consumer confidence and industrial confidence from the euro area surpassed the market expectations earlier in the European session, the pair struggled to shake off the selling pressure as investors remained focus on the greenback's recovery. Later in the day, upbeat macro data readings from the U.S. provided an additional boost to the US Dollar, pushing the DXY to a new session high at 92.88. At the moment, the index is at 92.85, up 0.63% on the day.

Today's employment data released by the ADP showed that the private sector added 237,000 jobs on a monthly basis in August, beating the market estimate of 185,000. Moreover, the preliminary annual GDP growth for the second quarter improved to 3% from 2.6%.

On Thursday, the economic calendar will be featuring the unemployment rate from Germany and the euro area, which are both expected to remain unchanged at 5.7% and 9.1% respectively. Moreover, the preliminary CPI for August will be released from the euro area. Markets expect the CPI to advance to 1.4% on a yearly basis in August. A higher-than-expected number could allow the shared currency to start retracing today's losses against the greenback. However, a dismal reading is likely to put a heavy selling pressure on the euro as the ECB is likely to delay its QE tapering in a low-inflation environment. Additionally, investors have been speculating that the euro was too strong against its peers for the ECB's liking. Later in the day, the core PCE price index, the favorite inflation gauge of the Federal Reserve, will be watched closely in the NA session. However, the market reaction to this data could remain limited ahead of tomorrow's critical nonfarm payroll report.

• EUR/USD bears in control despite EUR-supportive data - Scotiabank

Technical outlook

Valeria Bednarik, Chief Analyst at FXStreet, writes, "from a technical point of view, the risk is towards the downside for the upcoming sessions, with the pair trading at its weekly lows below the 1.1900 figure, and with the 4 hours chart showing that the price is now developing below its 20 SMA, whilst technical indicators keep accelerating north within negative territory, coming straight from overbought readings. August 11th high at 1.1846 is the immediate support and the level to break to confirm a bearish continuation down to the 1.1770 region this Thursday."

According to the analyst, supports for the pair could be seen at 1.1850, 1.1810 and 1.1770 while resistances align at 1.1925, 1.1960 and 1.2000.

Today's data from the U.S.

• US: Private sector employment increased by 237,000 jobs in August
• US: Real GDP increased at an annual rate of 3.0% in second quarter of 2017