EUR/USD re-testing the 1.1100 region ahead of US data
- EUR/USD climbs further and re-visits the 1.1100 handle.
- DXY fades the earlier optimism and is back near 97.50.
- US Claims, trade surprised to the upside.
EUR/USD has quickly left behind Wednesday’s pullback and it is now flirting once again with the key barrier in the 1.1100 neighbourhood.
EUR/USD firm in 4-week highs
After two consecutive weeks with losses, the pair is now trading firm into the positive ground, always propped up by the persistent and renewed selling bias around the greenback.
Poor prints in the US docket as of late have resurrected doubts regarding the ‘good shape’ of the US economy, while news on the US-China trade front have been also weighing on yields and morphed into extra weakness for the buck.
Data wise in Euroland, Retail Sales disappointed expectations in October, while final Q3 GDP prints matched consensus. In the US economy, weekly Claims rose by 203K, dropping to a 7-month low, while the trade deficit shrunk to $47.2 billion in October (from $51.1 billion).
Later in the session US Factory Orders and Durable Goods Orders for the month of October will close the daily calendar.
What to look for around EUR
The pair has finally broken above the key barrier at 1.1100 the figure amidst the continuous bearish note in the greenback and the comeback of US-China trade tensions, although it could not sustain the break and returned to the comfort zone around 1.1080/90. On the more macro view, the slowdown in the region appears far from abated despite some positive results from key fundamentals in Germany and the euro bloc as of late. This does nothing but justify the ‘looser for longer’ monetary stance by the ECB and the cautious/bearish view on the European currency in the medium term.
EUR/USD levels to watch
At the moment, the pair is gaining 0.16% at 1.1095 and faces the next hurdle at 1.1116 (monthly high Dec.4) seconded by 1.1158 (200-day SMA) and finally 1.1179 (monthly high Oct.21). On the other hand, a breakdown of 1.1067 (100-day SMA) would target 1.1042 (55-day SMA) en route to 1.0989 (monthly low Nov.14).