- EUR/USD gains upside traction and tests 1.1245/50.
- ECB Forum in Sintra in the limelight this week.
- US NY Empire State Index in multi year lows.
The buying pressure appears to have returned to the single currency and is now motivating EUR/USD to advance to session peaks in the mid-1.1200s.
EUR/USD higher on data
The pair is now extending the bounce off recent lows in the boundaries of 1.1200 the figure recorded earlier in the day.
In fact, the selling pressure around the buck has intensified after the manufacturing gauge by the NY Empire State index plummeted to -8.6 for the month of June, the lowest level since October 2016.
Further market chatter around potential rate cuts by the Fed are doing the rounds now and is forcing the greenback to recede to daily lows in the vicinity of 97.30 when tracked by the US Dollar Index.
Still in the US calendar, the NAHB index is coming up next while TIC Flows will close the docket for the day.
In the meantime, and other than the FOMC meeting on Wednesday, investors should remain vigilant on the always-interesting ECB Forum in Sintra (Portugal).
What to look for around EUR
The broad-based risk-appetite trends and USD-dynamics should dictate the sentiment surrounding the European currency for the time being, all in combination with developments from the US-China trade spat. On the political front, Italian politics is expected to remain a source of uncertainty and volatility, with the centre of the debate on the country’s opposition to EU fiscal rules as well as the challenging tone from LN’s M.Salvini. EUR, however, is expected to remain under scrutiny amidst the renewed dovish stance from the ECB and the ongoing slowdown in the region.
EUR/USD levels to watch
At the moment, the pair is gaining 0.27% at 1.1237 and a break above 1.1347 (high Jun.7) would target 1.1358 (200-day SMA) en route to 1.1448 (monthly high Mar.20). On the flip side, initial support is located at 1.1202 (low Jun.14) seconded by 1.1200 (low Jun.6) and finally 1.1115 (low May 30).
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