- DXY remains broadly subdued near 3-week lows.
- EUR lifted on EU growth story.
- US CPI and retail sales data in focus.
The EUR/USD pair extends its overnight consolidative mode near three-week tops into Asia, as the bulls await the key US macro releases for the next push higher.
EUR/USD poised to test Oct 26th high at 1.1837
Having reached fresh multi-week highs at 1.1805 levels in the last US session, the bulls took a breather in the Asian trades, as broad-based USD selling stalled, with attention now turning towards the US inflation and retail sales data slated for release later in the NA session.
On Tuesday, EUR/USD rallied almost 150 pips, as the rates received double booster shot from solid German and Eurozone growth numbers, while the greenback was dumped across the board in tandem with Treasury yields, in the wake of rising uncertainty over the US tax reforms, and as markets now assess its impact on the economy.
Further, a positive surprise delivered by the US PPI data also failed to offer some respite to the USD, as a Dec Fed rate hike is already priced. The USD index now meanders near three-week lows of 93.64, almost unchanged on the day.
Ahead of the US data, the pair will continue to track the USD dynamics and risk trends for fresh momentum.
EUR/USD Technical Levels
Valeria Bednarik, Chief Analyst at FXStreet., noted: “According to technical readings in the 4 hours chart, as technical indicators head north within an overbought territory, while the 20 SMA accelerated higher, maintaining its upward slope after crossing above the 100 SMA, both far below the current level. The pair has also broken above the 200 SMA, above all of its moving averages for the first time since mid-September. A strong resistance area comes now between 1.1820 and 1.1830, where selling have proved strong multiple times in the past. Beyond it, and despite overbought conditions, the rally will likely continue toward the 1.1900 figure.”
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