EUR/USD looks firmer, clinches tops near 1.1130
- EUR/USD advances further to the 1.1130 region.
- The dollar has started the week on a soft fashion so far.
- Recent decline met support near 1.1080.
EUR/USD is adding to Friday’s gains and is moving to the 1.1130 area, recording at the same time new 3-day highs.
EUR/USD looks to data, trade
The pair is up for the second session in a row on Monday and remains underpinned by rising optimism in light of the imminent sign of the US-China’s ‘Phase One’ deal later this week.
In addition, investors continue to digest Friday’s lower-than-forecasted Payrolls figures, putting the greenback under some downside pressure at the beginning of the week. Also collaborating with the better mood in the risk-associated complex, geopolitical tensions stay subdued for the time being.
Nothing scheduled today in the euro docket, while speeches by FOMC’s E.Rosengren (Boston Fed) and R.Bostic (Atlanta Fed) should keep the attention on the buck. Later in the week. German GDP figures and the ECB Accounts will be the salient events in the domestic calendar.
What to look for around EUR
Spot seems to have met some decent contention in the 1.1085/80 band so far. This area of support is reinforced by the vicinity of the key 55-day SMA in the 1.1090 area. The inability of the spot to surpass the area of recent tops beyond the 1.1200 handle – ideally in the short-term horizon - carries the potential to trigger some consolidation and eventually the resumption of the downside. In the meantime, markets’ focus has now returned to the US-China’s ‘Phase One’ deal, likely to be signed in the next days. On the more macro view, the slowdown in the region remains far from abated and continues to justify the ‘looser for longer’ monetary stance from the ECB.
EUR/USD levels to watch
At the moment, the pair is gaining 0.10% at 1.1128 and faces the next up barrier at 1.1139 (200-day SMA) seconded by 1.1186 (61.8% of the 2017-2018 rally) and finally 1.1199 (high Dec.13 2019). On the downside, a breach of 1.1092 (55-day SMA) would target 1.1085 (2020 low Jan.10) en route to 1.1066 (low Dec.20 2019).