EUR/USD: 1.2000 still on sight ahead of German ZEW?

The EUR/USD pair remained better bid in the Asian trades this Tuesday, having found some support from weaker Treasury yields, while investors eagerly await the German ZEW surveys for fresh impetus.

EUR/USD rises to test 1.1975, what next?

After a brief phase of consolidation around 1.1950 levels seen in the overnight trades, the EUR/USD pair caught a fresh bid-wave and headed northwards in a bid to reclaim 1.20 handle.

The recovery in the spot was mainly driven by broad based US dollar weakness, in response to tumbling Treasury yields, as uncertainty weighed-in over the US military spending and its impact on overall government spending.

However, over the last hour, the US dollar makes minor recovery attempts against its major peers, following the WSJ headlines that cited the US Senate Republicans mull USD1.5 trillion tax cut for budget. As a result, the major is seen receding gains and heads back towards the 10-DMA resistance-turned support of 1.1964.

Further, risk-on rally seen in the Asian equities also keep the gains in the funding currency Euro limited. Despite, the latest leg down, the sentiment around the main currency pair remains buoyed amid expectations of a solid improvement in the German ZEW economic sentiment.

Also of note for the major remains the US dataflow due on the cards later in the NA session, which includes the housing, current account and import prices data.

EUR/USD Technical Set-up  

Valeria Bednarik, Chief Analyst at FXStreet noted: “For the upcoming hours, the immediate support comes at 1.1910, with a break below the level exposing the 1.1860/70 region, ahead of a more relevant support at 1.1825. Selling interest has surged on approaches to the 1.2000 figures, which means that the pair would need to accelerate through the next resistance, at 1.2030, to confirm further gains ahead.”