EUR/USD: Range-trade intact, awaits German Ifo for fresh impetus
|- Stronger Euro area PMIs underpin.
- DXY in Thanksgiving resting.
- German Ifo surveys in focus.
The EUR/USD pair extended its overnight range-trade around the midpoint of 1.18 handle into Asia this Friday, as a lack of fresh drivers combined with holiday-thinned trading now leaves the rates at the mercy of the German Ifo business surveys for some fresh trading impetus.
EUR/USD: Risk remains to the upside
The spot continues to hover near the weekly tops of 1.1856 and remains on track to book the third straight weekly gain, as the sentiment remains underpinned by the expectations of stronger economic growth prospects, especially after the Euro area manufacturing sector activity reports surprised the markets to the upside.
- Germany Markit Manufacturing PMI above expectations (60.4) in November: Actual (62.5)
- France Markit Manufacturing PMI above expectations (55.9) in November: Actual (57.5)
Moreover, upbeat remarks from the ECB Governing Council member Villeroy, citing that, ‘Eurozone recovery robust and broad-based’, remains supportive of the EUR upmove. Also, markets paid little attention to the ECB monetary policy minutes, as broad-based US dollar weakness remained the main theme amid Fed’s cautious view on the US inflation and a holiday-shortened week.
Meanwhile, the political developments surrounding Germany kept a lid on the common currency, leaving the EUR/USD pair largely flat-lined. Later today, all eyes remain on the German Ifo business climate surveys, as the pair is expected to extend its wobble amid slowing volumes on Thanksgiving holiday-break.
EUR/USD Technical Levels
Valeria Bednarik, Chief Analyst at FXStreet, explained: “in the 4 hours chart, the price is well above a now bullish 20 SMA, as the Momentum maintains its bullish slope near overbought readings, and the RSI consolidates around 68. Furthermore, the pair is holding above the key 1.1790 level, the 23.6% retracement of the latest bullish run. The pair has a strong resistance at 1.1890, where selling interest capped the advance for most of October. Beyond it, and approach to the 1.2000 thresholds becomes more than likely. Support levels: 1.1830 1.1790 1.1745. Resistance levels: 1.1860 1.1890 1.1925.”
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