EUR/USD consolidated near 3-year tops, US macro data awaited
| • German political headlines eased months of uncertainty.
• Persistent USD weakness provides an additional boost.
• US CPI & monthly retail sales data to provide fresh impetus.
The EUR/USD pair held on to its strong gains above the 1.2100 handle and now seems to have entered a bullish consolidation phase near 3-year tops.
Against the backdrop of Thursday's hawkish ECB monetary policy meeting minutes, the latest German political development, wherein coalition party leaders reached a breakthrough in talks to form a new government and provided an additional boost to the shared currency.
Moreover, the prevailing strong bearish sentiment surrounding the greenback, with the key US Dollar Index tumbling to its lowest level since September, remained supportive of the pair's strong up-move to the highest level since Jan. 2015.
Traders now look forward to the US economic docket, featuring the release of consumer inflation figures and monthly retail sales data, for some fresh impetus on the last trading day of the week.
Technical outlook
Mario Blascak, European Chief Analyst at FXStreet writes: “With technical oscillators including Momentum, the Relative Strength Index and Slow Stochastics all pointing upwards, the potential of moving towards the targeted $1.2170 is in place, especially as the next target is in sight of current spot rate. Should $1.2170 be broken on the upside, next target for EUR/USD is $1.2600, representing 61.8% Fibonacci retracement of the above-mentioned move lower to $1.0350.”
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