EUR/USD heads for the highest close in months, eyes 1.1200
- EUR/USD has the best week since October but remains below December intraday highs.
- US dollar is among the biggest losers in a shortened week.
The EUR/USD continued to rise during Friday’s American session and printed a fresh two-week high at 1.1187. As of writing, it trades at 1.1180/82, consolidating significant daily gains. From the level it had a week ago, the pair is up a hundred pips, on its way to the highest weekly close since August.
The key driver in EUR/USD has been a weaker US dollar. The rally across financial markets during the Christmas week weighed on the greenback. The DXY lost 0.60% on Friday and posted the worst weekly results since mid-October. It was about to end the week under 97.00.
Test of 1.1200 seems likely
The euro is ending the week with bullish signals, so a test of the 1.1200 zone over the next sessions seems likely. The mentioned level capped the upside during December and is also where the 55-week simple moving average stands, so a consolidation above could point to more gains.
Is the current bullish strength enough for a break above 1.1200? At the moment, it appears to be a story more related to the US dollar’s weakness. The last time the euro traded comfortably above 1.1200 was back in July.
A failure at current levels would favor a correction, that could intensify if EUR/USD drops below 1.1095 (20-day moving average).
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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.
