EUR/USD: ready to challenge 1.1300
EUR/USD Current price: 1.1278
Speculators were looking for a catalyst, and ECB's head, Mario Draghi finally provided it this Tuesday. The leader of the EU Central Bank sent the common currency to its highest in two weeks, and not far from the yearly high against the greenback, by saying that "all the signs now point to a strengthening and broadening recovery in the euro area," in a speech at the Central Bank Forum on Central Banking, in Portugal. Draghi added that policy makers will have to be prudent to gradually adjust its monetary stimulus to the economic recovery and that stimulus is still needed, adding his usual dovish rhetoric. Still, the EUR/USD pair jumped higher with the news, advancing continuously ahead of the US opening, and some minor macroeconomic releases in the US, including manufacturing and house price indexes. Later, focus will turn to a couple of Fed's speakers, including Janet Yellen.
The EUR/USD pair trades near its daily high of 1.1280, poised to challenge the 1.1300 critical threshold, as the price topped right below it a couple of times this year, while the level is also the high posted last November, as an immediate reaction to the US election's result. In the 4 hours chart, the price has broken sharply above all of its moving averages, whist technical indicators are partially losing their bullish strength within overbought levels, still far from reversing. With Yellen still pending, chances of a break higher are limited short-term, although once above the level, there's a good chance large stops will get triggered, resulting in another leg north.
Support levels: 1.1265 1.1220 1.1190
Resistance levels: 1.1300 1.1340 1.1380
Author
Valeria Bednarik
FXStreet
Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.
