EUR/USD fades the spike to 1.1050 ahead of data, ECB-speak

  • EUR/USD met support near 1.1030 on Wednesday.
  • Risk-on trade keeps dominating the global sentiment.
  • ECB’s C.Lagarde, L. de Guindos, P.Lane due to speak later.

After bottoming out in the proximity of 1.1030, EUR/USD has sparked a correction higher to the 1.1050 region on Wednesday.

EUR/USD looks to data, ECB

The pair remains on the defensive so far this week, coming under selling pressure after hitting fresh weekly tops in the boundaries of 1.1100 the figure last Friday.

The renewed sentiment surrounding the risk complex stays underpinned by ebbing concerns around the Wuhan coronavirus, which continues to support the exodus from safe havens and sponsor the move up in yields.

In the docket, final Services/Composite PMIs in Euroland for the month of January came in on the positive side ahead of December’s Retail Sales in the bloc due later. In addition, ECB’s Largarde, de Guindos and Lane are due to speak.

Across the pond, the employment report tracked by ADP is due seconded by the ISM Non-Manufacturing and the speech by FOMC’s permanent and dovish member L.Brainard.

What to look for around EUR

The pair remains on the defensive so far this week after faltering just ahead of the 1.1100 mark in past days. As usual, dynamics around the buck are expected to remain the exclusive driver of the pair’s price action for the time being along with alternating risk appetite trends in response to developments from the Wuhan coronavirus. On another scenario, the ECB is expected to finish its strategic review (announced last Thursday) by year-end, leaving speculations of any change of the monetary policy before that time pretty flat. Further out, some better-than-expected results in the euro region as of late seem to have lent support to the idea that the bloc could have left the worst behind, although that view looks premature, to say the least.

EUR/USD levels to watch

At the moment, the pair is losing 0.04% at 1.1038 and a breakdown of 1.1032 (weekly low Feb.4) would target 1.0992 (weekly/2020 low Jan.29) en route to 1.0981 (monthly low Nov.29 2019). On the flip side, the initial hurdle emerges at 1.1068 (100-day SMA) seconded by 1.1094 (weekly high Jan.31) and finally 1.1118 (weekly high Jan.21).

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news

How do emotions affect trade?
Follow up our daily analysts guidance

Subscribe Today!    

Latest Forex News

Latest Forex News

Editors’ Picks

EUR/USD slides under 1.16 as US Retail Sales smash estimates

EUR/USD is trading under 1.16 after US Retail Sales smashed estimates with 0.7% in September. Treasury yields are rising. The risk-on mood continues to underpin the pair, as the ECB policymaker Wunsch dismisses inflation concerns. 


GBP/USD retreats below 1.3750 after US data

GBP/USD has pared some of its gains after US Retail Sales beat estimates, with the core group hitting 0.8% last month. Earlier, investors shrugged off dovish comments from two BOE members. 


XAU/USD slumps to $1,770 area on upbeat US data, surging US bond yields

Gold started the last day of the week on the back foot and extended its slide to a fresh daily low of $1,770 in the early trading hours of the American session pressured by the dollar's resilience and surging US Treasury bond yields.

Gold News

Crypto bulls on winning streak pushing for more

Bitcoin price favors bulls reaching $60,000 by the end of this week and onwards to new all-time highs by the end of next week. Ethereum price broke a bearish top line and could hit new all-time highs by next week in tandem with Bitcoin. 

Read more

Why is Tesla going up?

Tesla's (TSLA) stock price has finally pushed higher in a series of steady and sure moves. We had nearly given up on our bullish call with Tesla stock as it kept struggling around the $800 level.

Read more