EUR/USD revisits daily highs near 20-DMA

FXStreet (Mumbai) - Fresh bids emerged for EUR/USD ahead of hourly 200-SMA at 1.0913 in early Asia, driving the pair further in the positive territory as we head towards early Europe.

EUR/USD holds above 1.09 barrier

Currently, the EUR/USD pair trades 0.11% at 1.0935, retesting daily highs printed in opening trades at 1.0937, where the 20-DMA resistance lies. The main currency pair appears to pick-up pace for further upside, extending its recovery from sub-1.09 barrier reached on Tuesday, on the back of fading demand for the greenback as markets now shift their attention towards a set of second-tier data from the Euro land due later in the session ahead. Euro zone money supply data and Spanish flash CPI may provide some fresh incentive on the major.

Meanwhile, markets moved past mixed US economic numbers released yesterday and now anticipate upbeat pending home sales, which is likely to add further strength in the US dollar. On Tuesday, the US consumer confidence for December improved from 92.6 to 96.5. while the S&P/Case-Shiller home price indices came out mixed. The goods trade gap shrank marginally to $60.5 billion in Nov.

Analysts at Nomura noted, “The pending home sales index leads existing home sales by a couple of months and should give us an indication of the pace of existing home sales in December. Consensus forecasts a 0.6% increase in the pending home sales index for November.”

EUR/USD Technical Levels

In terms of technicals, the pair finds the immediate resistance is seen at 1.0955 region (5-DMA). A break beyond the last, doors will open for a test of 1.1000 (round number). On the flip side, the immediate support is placed at 1.0913 (1h 200-SMA), below which 1.0886 (daily S1) could be tested.

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