EUR/USD: Frozen ahead of fresh clues
|EUR/USD Current price: 1.1801
The EUR/USD pair trades barely above the 1.8000, up from a daily low of 1.1780, as the dollar was generally lower against most of its major rivals early London, exception the Canadian dollar, helping the common currency that lacks strength of its own amid political jitters in the region. The pair gapped lower at the weekly opening, hurt by headlines indicating that the German Social Democrat party beat Angela's Merkel ruling one in Lower Saxony, and comments from Fed's head Yellen, who offered a confident outlook on inflation and the economy, nothing that the market didn't heard before. Another factor weighing on the EUR is the situation in Spain, as Catalonia President Carles Puigdemont avoided to clarify whether he declared independence or not, and asked for a two-month window of dialogue, whilst the central goernment, through Spanish Vice President/ Deputy PM, Soraya Saenz de Santamaria, answered that they are still waiting for an answer that should be delivered not later than early Thursday.
In the data front, the EU release its August trade balance data, which recorded a surplus of €16.1B compared with €17.5B a year earlier, missing market's expectations. Ahead of Wall Street's opening, the greenback got a short-lived boost from the New York Empire manufacturing index, which came in much better-than-expected, at 30.2 from previous 24.4, its highest in over three years.
From a technical point of view, the pair has made little progress during the last two sessions, still trading in the red when compared to Friday's close. In the 4 hours chart, the price has managed to regain ground above a bearish 100 SMA, but still below the 20 and 200 SMAs, while technical indicators remain within negative territory, losing the limited upward strength they presented earlier today. The upward scope seems limited by selling interest on approaches to 1.1820, and seems there won't be today a trigger that can push the level beyond it. If it happens, however, the pair has scope to extend its gains up to the 1.1850 region. To the downside, the 50% retracement of the latest bullish run stands at 1.1775, while the pair has a static support a few pips below the level, in the 1.1760 region. Below this last, the 1.1720 comes next ahead of the critical 1.1660 region.
Support levels: 1.1760 1.1720 1.1660
Resistance levels: 1.1850 1.1890 1.1930
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