EUR/USD extends gains above 1.1400 as US dollar tumbles

From yesterday’s low, EUR/USD rose 120 pips.
US dollar having the worst day in months, GBP among best performers.

Matías Salord FXStreet

The EUR/USD pair rose back above 1.1400 and climbed to 1.1423, reaching the highest level in a week. A day ago, the euro was trading at the weakest in 2 months, testing the 2018 low near 1.1300 and now is at the strongest in a week. From a day ago, the pair climbed more than a hundred pips. It is having the best performance in a month.

The move to the upside was triggered by a sharp slide of the US Dollar across the board. The US Dollar Index (DXY) is falling almost 1%, at 96.22. The index on Wednesday peaked at 97.20, the highest since June 2017.

Today’s USD slide could represent a short-term top for the greenback, pointing to further weakens or to some consolidation. Markets ignore today’s US data but tomorrow the NFP report could have a more significant influence. In Europe, the final reading of the Markit PMIs is due.

US yields are modestly lower while Wall Street is rising. The Dow Jones was up 0.80% and the Nasdaq 1.45%. Among currencies, the New Zealand dollar and the pound were the best performers. The slide of EUR/GBP limited EUR/USD’s rally.

EUR/USD - Levels to watch

While above 1.1400, the bullish tone could remain intact. The immediate resistance could be seen at 1.1430 (Oct 16 low / Oct 25 high), followed by 1.1465 (21-day simple moving average) and 1.1490/95. On the flip side, support levels might be located at 1.1400, 1.1375/80 and 1.1355.

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

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