Global macro overview for 01/08/2016:
A set of manufacturing PMI's from almost all over the world were released today, so let's take a look at the European PMIs now. The British PMI was quite weak, released at the level of 48.2 vs. 49.1 expected and 49.1 prior. The French PMI was unchanged at the level of 48.6. The best PMI came from Germany, but it wasn't anything spectacular: the number revealed was at the level of 53.8 vs. 53.7 and 53.7 prior. The worst PMI from all eurozone countries came from Italy, and it dropped quite significantly to the level of 51.2 from 53.5 a month ago, vs. 52.5 expected. In conclusion, we can still see the leading role of the German economy in the whole eurozone and the lagging tail of Italian and Spanish economies. So far, the difference hasn't been that big to worry too much about it, but once the German power engine refuses to continue providing the good results, the whole eurozone may face a big trouble.
Now let's take a look at the EUR/USD technical picture on the 4H time frame. The bulls have managed to retrace 50% of the previous swing and the price stalled at 1.1194. Nevertheless, the market is still trading inside of the congestion zone and none of the key levels has been tested or broken yet. Sideways market has been kept valid so far with the next support seen at 1.1118.
