EUR/USD surges to near 3-week tops amid notable USD supply
• Persistent USD selling help conquer 1.1680 hurdle.
• Moves above 1.1700 for the first time since ECB meeting.
• Seems more likely to extend the up-move.
The EUR/USD pair continued gaining traction through the early NA session and was seen building on its strong bullish momentum further beyond the 1.1700 handle.
Persistent US Dollar selling bias helped the pair to finally break through the 1.1670-80 strong horizontal hurdle, taking along some stops near the 1.1700 handle and rising to its highest level since the ECB meeting in late October.
Apart from broad-based USD weakness, the shared currency was further supported by today's upbeat ZEW economic survey, which coupled with in-line prelim EZ GDP figures pushed the pair to mid-1.1700s, or near three week tops.
• Eurozone economy keeps up its strong performance - ING
Against the backdrop of some renewed weakness around the US Treasury bond yields, a follow-through up-move, led by some additional short-covering, remains a distinct possibility as traders look forward to the release of US PPI print for some fresh impetus.
• US: Expect a steady increase in core PPI - Nomura
Technical levels to watch
Momentum beyond mid-1.1700s could get extended towards the 1.1790-1.1800 hurdle, which if conquered would negate any near-term bearish bias and pave way for extension of the pair's near-term upward trajectory.
On the flip side, the 1.1700 handle now seems to protect the immediate downside, which if broken could drag the pair back towards 1.1655 horizontal support en-route its next major support near the 1.1620 region.