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EUR/USD tests 1.1350 ahead of EU CPI

FXStreet (Mumbai) - The risk-on rally in the European indices appears to take a toll on the European currency versus its American peer, knocking-off EUR/USD to fresh session lows near the mid-point of the 1.13 handle.

EUR/USD capped below hourly 20-SMA

The EUR/USD pair falls -0.25% to 1.1358, retreating from fresh two-day lows struck at 1.1354 last minutes. The major ran through fresh offers near the hourly 20-SMA placed at 1.1379 and accelerates losses thereon, with eyes set on the hourly 200-DMA at 1.1338.

The EUR/USD pair came under renewed selling pressure after Thursday’s dovish comments from ECB policymaker Ewald Nowotny spurred hopes of further QE expansion by the central bank.

More so, the persisting upbeat global sentiment drove the European stocks higher for the second straight session, thus reducing the demand for the euro as a safer bet. The pan European benchmark, the Euro Stoxx 50 jumps 0.93% to 3,267 while the DAX advances 0.78% to 10,141.

Looking ahead, the pair will be influenced by the Euro zone final CPI figures ahead of the US economic data releases with the consumer sentiment survey expected to be the main market mover later today.

EUR/USD Technical Levels

The pair struggles below the 1.14 barrier which acts as the immediate resistance, beyond which 1.1421 (hourly 50-SMA) would be tested and from there to 1.1466 (daily R1). While the immediate support is located at 1.1346 (10-DMA), a breach of the last would expose 1.1300 (psychological levels), below which floors open for a test of 1.1279/1.1276 (20-DMA & 50-DMA).

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