- The pair keeps consolidating gains above 1.1300 the figure.
- Markets look calmer in the wake of Brexit vote and despite renewed concerns arising on the trade and geopolitical fronts.
- The critical 200-week SMA emerges as the next significant hurdle.
EUR/USD continues its march north so far this week and is now looking to consolidate the recent breakout of the critical 1.1300 barrier. The upside momentum, however, seems to have met tough resistance in the 1.1330/40 band for the time being, where emerges the critical 200-week SMA.
Spot has managed to keep the composure in the upper end of the weekly range despite ups & downs in volatility, all in response to the equally changing mood in the risk-associated complex following this week’s key Brexit votes. In this regard, the performance of EUR/GBP should prove to be key in the pair’s price action in the weeks to come, as EU-UK negotiations are expected to intensify following yesterday’s vote on an extension of Article 50.
In addition, concerns over the US-China trade dispute have resurfaced, although market participants appear to have the issue somehow priced in already. The now postponed meeting between President Trump and China’s Xi Jinping is expected at some point during next month.
In the very near term, final CPI figures in Euroland are unlikely to be a market mover today, while the pair should pay more attention to releases in the US docket, where Industrial Production, the NY Empire State index and advanced Consumer Sentiment will be in centre stage.
Speaking about levels, the already mentioned 200-week SMA – today at 1.1334 - emerges as the critical hurdle to overcome in order to allow for a continuation of the up move to the 1.1370 region, coincident with the 55-day and 100-day SMAs. Further north, the 5-month resistance line, today at 1.1432, remains a key level and spot needs to clear it to alleviate the downside pressure and re-focus on the 1.1500 neighbourhood. Looking south, the 1.1180 region – 2019 lows – remains the magnet for EUR bears.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.