EUR/USD clocks fresh 6-week tops at 1.1875 on German Ifo
- German Ifo business morale boosted to all-time highs.
- DXY hits fresh five-week lows.
- Eurozone economic growth optimism offsets political woes.
The EUR/USD pair found fresh support again near 1.1840 levels and from there staged a solid rebound to print fresh six-week lows of 1.1875, following the release of upbeat German Ifo business climate data,
EUR/USD: Bullish bias intact
At the time of writing the spot eased from multi-week tops, but remains within a striking distance near 1.1865, up +0.14% on the day. The renewed uptick seen in the Euro is mainly driven by an unexpected improvement seen in the German business climate numbers for November, suggesting that markets have looked past the German political woes. Moreover, the Ifo cited that ECB decision to reduce bond purchases appears not to have affected the German business morale.
Further, fresh selling seen in the US dollar across its main competitors also collaborated to the latest leg higher in the major. Looking ahead, the main currency pair is expected to remain underpinned amid expectations of stronger Eurozone economic growth, which may overshadow any concerns surrounding the German political climate.
EUR/USD Technical Levels
Slobodan Drvenica at Windsor Brokers Ltd., explained: “Strong rally in past two days eyes key barriers at 1.1877/86 (daily cloud top/Fibo 61.8% of 1.2092/1.1553 descend) with a sustained break here needed to generate the fresh bullish signal. The pair is on track for the third consecutive bullish weekly close, which supports the scenario of bullish continuation. The base of daily cloud offers solid support at 1.1825, with extended dips to be contained by rising 10SMA (1.1770) which is forming a bull cross with 55SMA. Only close below the latter would sideline bullish scenario and signal further easing. Res: 1.1859; 1.1877; 1.1886; 1.1936. Sup: 1.1836; 1.1825; 1.1813; 1.1770.”