Investing.com - The euro traded lower against the dollar on Monday even after data revealed U.S. new home sales disappointed in July, as the greenback held firm on broad consensus that the U.S. economy continues to improve despite hiccups here and there.
In U.S. trading, EUR/USD was down 0.30% at 1.3200, up from a session low of 1.3184 and off a high of 1.3297.
The pair was likely to find support at 1.3184, the session low, and resistance at 1.3412, the high from Aug. 15
The U.S. Commerce Department reported earlier that U.S. new home sales dropped by 2.4% to 412,000 units last month, confounding expectations for an increase of 5.7% to 430,000.
New home sales in June were revised up to 422,000 units from a previously reported 406,000 units.
Markets shrugged off the report, as last week data revealed that U.S. existing home sales increased 2.4% to 5.15 million units last month from 5.03 million in June. Analysts had expected existing home sales to dip 0.4% to 5.02 million units in July.
Federal Reserve Chair Janet Yellen said last week that the economy is on the mend and the labor market continues to improve, which left markets concluding that stimulus programs will close around October and rate hikes will kick in some time in 2015, possibly sooner than markets were originally anticipating.
Meanwhile in Europe, the Ifo research institute said its German Business Climate Index fell to a more than one-year low of 106.3 this month, missing forecasts for 107.0 and down from 108.0 in July.
The weak data dampened optimism over the health of the euro zone’s largest economy.
Elsewhere, the euro was down against the pound, with EUR/GBP down 0.42% at 0.7958, and down against the yen, with EUR/JPY down 0.31% at 137.23.
On Tuesday, expect markets to move on U.S. durable goods and consumer-confidence data.