EUR/USD upside stalled near 1.1500 ahead of PMIs
- The pair has started the week on a positive note near 1.1500.
- USD-weakness keeps sustaining the optimism around spot.
- Final December PMIs in Euroland next on tap in the docket.
The demand for the single currency remains healthy at the beginning of the new year and is now bolstering another bull run in EUR/USD to the boundaries of the critical 1.1500 the figure.
EUR/USD looks to data, trade
The pair has receded some ground after hitting fresh highs near 1.1550 on Tuesday, levels last seen in mind-October. The up move, however, has been on the back of marginal trade conditions as most of the global markets were closed in the first day of the new year.
Today, renewed optimism on the US-China trade dispute brought in some fresh buying interest in the pair, pushing it to the top of the recent range albeit still below the 1.1500 handle. Collaborating with the sentiment, the selling bias around the buck remains well in place while investors keep their focus on the current partial US government shutdown.
Looking ahead, final December manufacturing PMIs in Euroland will be the only releases of note as market participants slowly leave behind the festivities’ mood.
What to look for around EUR?
In the near term horizon, USD-dynamics should remain as the main driver of the pair’s price action. Furthermore, a steady/dovish stance from the ECB should provide no excuses for a serious attempt higher in EUR, although market participants will increasingly look for any hints of a potential move in rates in H2 2019. The region, in the meantime, keeps exhibiting positive figures in terms of economic growth while inflation remains stagnant for the time being.
EUR/USD levels to watch
At the moment, the pair is gaining 0.10% at 1.1475 facing the next hurdle at 1.1547 (high Jan.1) followed by 1.1623 (high Oct.16 2017) and finally 1.1655 (200-day SMA). On the flip side, a breakdown of 1.1477 (10-day SMA) would target 1.1386 (21-day SMA) en route to 1.1268 (monthly low Dec.14 2017).