- The pair gyrates without direction around the 1.1300 handle.
- The greenback looks to reclaim 97.00 ahead of data.
- German ZEW coming up next ahead of US Industrial Production.
EUR/USD seems to have met a strong resistance in the area above the critical barrier at 1.1300 the figure, prompting the current sideline theme ahead of key data releases in Euroland and across the pond.
EUR/USD looks to data, risk
The upside momentum in risk appetite trends look somewhat exhausted in the first half of the week, prompting gains in the pair to falter in the 1.1320/30 band, where is located the 55-day SMA.
In the meantime, developments in the US-China trade talks continue to drive the broader sentiment in the global markets, although there is no extra news apart from recent comments from S.Mnuchin.
Looking ahead, the upcoming release of the German ZEW survey has gained importance as of late in light of the ongoing slowdown in the euro region. In the US docket, Industrial Production, Manufacturing Production and Capacity Utilization should give investors further details on the performance of the US economy.
What to look for around EUR
Positive sentiment in the risk-associated complex continues to support the shared currency amidst the lack of upside traction in the buck. The ECB reiterated the risks to the economic outlook in the region remains tilted to the downside, a view reinforced by poor results from fundamentals in past weeks. That said, the ‘patient-for-longer’ stance from the ECB could be among us for longer than expected. Against this backdrop, the neutral stance from the Fed and occasional deterioration in the risk-on mood should lend support to the buck and thus limit the upside in spot. On the political front, headwinds are expected to emerge in light of the upcoming EU parliamentary elections and the swelling presence of the populist movement among the voting countries.
EUR/USD levels to watch
At the moment, the pair is gaining 0.05% at 1.1309 and a breakout of 1.1337 (200-week SMA) would target 1.1345 (100-day SMA) en route to 1.1419 (high Feb.14). On the downside, immediate support emerges at 1.1273 (21-day SMA) seconded by 1.1183 (low Apr.2) and finally 1.1176 (low Mar.7).
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