EUR/USD: Bulls look to test multi-month highs near 1.1240
- US dollar index stalls recovery near 96.65.
- Euro lifted by rally in German yields and upbeat German/ EZ PMIs.
- Next of relevance remains US economic data and trade headlines.
EUR/USD has turned positive over the last hour, extending its gradual recovery from near 5-DMA support of 1.1204, as the USD bulls take a breather amid widening German-US 10-yield differential.
A solid surge in the German benchmark 10-year government bond yields has resulted in a huge gap between the German-US 10-year yields spread, eventually rendering EUR positive at the expense of the greenback.
Therefore, the US dollar’s recovery from five-month lows across its main peers stalls at 96.63, driving the spot back towards the four-month highs of 1.1241 reached on the final trading day of 2019.
Further, upward revisions to the December Eurozone and German Manufacturing PMIs also collaborates with the renewed upside in the main currency pair. Eurozone and German Final Manufacturing PMIs for December arrived at 46.3 and 43.7 respectively vs. 45.9 and 43.4 their respective flash readings.
Looking ahead, holiday-thinned trading will continue to persist, keeping the range in the spot limited. However, volatile moves cannot be ruled out amid thin conditions and ahead of the US Jobless Claims and Manufacturing PMI data. Markets also eye US-China trade updates for some trading impulse.
EUR/USD Technical levels to consider
Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
