EUR/USD loses some ground, retreats from tops near 1.2050


  • EUR/USD clinched new 7-week highs near 1.2050.
  • The dollar sell-off bolsters the upside in the pair so far.
  • Investors’ attention seen shifting to the ECB event (Thursday).

The euro cannot have a better start of the week. Indeed, the single currency saw its buying interest exacerbated on Monday and pushed EUR/USD further north of the psychological 1.2000 yardstick, clinching at the same time new multi-week highs.

EUR/USD meets resistance near 1.2050

EUR/USD adds to Friday’s gains and finally leaves behind the 1.2000 barrier on Monday. The strong advance, however, has so far met initial resistance in the mid-1.2000s, where sits the 100-day SMA.

The initial pessimism around the dollar dragged the US Dollar Index (DXY) to fresh lows in the proximity of the 91.00 mark, albeit managing to regain some composure soon afterwards.

The moderate retracement in the buck reflected the initial apathetic trade in US yield, with the 10-year benchmark navigating the 1.55% area before staging a bull run to the 1.615 region.

Nothing scheduled in the US docket on Monday, while the Current Account surplus in the euro area widened to €13.3 billion in February.

Moving forward, investors are likely to remain cautious ahead of the ECB event on Thursday, while FOMC members entered into the usual communication blackout period ahead of the Federal Reserve gathering on April 28.

What to look for around EUR

EUR/USD met initial resistance in the 1.2050 zone so far. The recent move higher in the pair has been sustained by the renewed offered bias in the dollar along with the investors’ shift to the growth prospect in Europe now that the vaccine campaign appears to have gained some serious pace. In addition, solid results from key fundamentals and the improvement in the sentiment in the euro area as of late also appear to bolster the momentum surrounding the single currency.

Key events in the euro area this week: ECB interest rate decision, President Lagarde’s press conference, European Commission advanced Consumer Confidence (Wednesday) – Flash April PMIs (Friday), ECB Lagarde speech.

Eminent issues on the back boiler: Asymmetric economic recovery in the region. Sustainability of the pick-up in inflation figures. Progress of the vaccine rollout. Probable political effervescence around the EU Recovery Fund.

EUR/USD levels to watch

At the moment, the index is gaining 0.34% at 1.2022 and faces the next hurdle at 1.2048 (monthly high Apr.19) followed by 1.2243 (monthly high Feb.25) and finally 1.2349 (2021 high Jan.6). On the other hand, a breach of 1.1906 (200-day SMA) would target 1.1762 (78.6% Fibo of the November-January rally) en route to 1.1704 (2021 low Mar.31).

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.

Feed news

Are you new to trading or have been trading for a while and you feel stuck?

Try with us!
Become Premium!
   

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD: EU vaccine deal helps extend US NFP-led run-up to fresh multi-day top towards 1.2200

EUR/USD begins the week with an uptick to refresh highest levels since February 26, wobbles around the top of late. EU battles for more vaccines as jab jitters disappoint the bloc members, Brexit, sluggish data add to the fears. DXY marked the biggest daily losses in six months after NFP debacle.

EUR/USD News

GBP/USD: Bulls on top in the open, but W-formation is compelling

GBP/USD is a mixed picture for days ahead as the price extends higher but leaves a bearish chart pattern on the daily time frame. The monthly chart is bullish while above the support structure as the price runs deeper into the supply territory.

GBP/USD News

Dogecoin: Defending 21-DMA is critical for DOGE after Musk calls it a ‘hustle’

The selling pressure in the Dogecoin (DOGE/USD) remains unabated for the second straight day on Sunday, as the corrective mode from all-time highs of $0.7605 remains intact. DOGE bulls remain hopeful as 21-DMA support holds, with RSI still bullish.

Read more

GBP/USD: Bulls on top in the open, but W-formation is compelling

GBP/USD is a mixed picture for days ahead as the price extends higher but leaves a bearish chart pattern on the daily time frame. The monthly chart is bullish while above the support structure as the price runs deeper into the supply territory.

GBP/USD News

S&P 500, Nasdaq Week Ahead: Fed to markets, we have your back never mind the jobs report!

Well after a fairly sluggish start to the week things certainly sprang to life on Friday as a brutal employment report was a catalyst for a strong rally! Go figure. Well, the logic is actually not as stupid as it first appears. Bears have been hibernating and face possible extinction.

Read more

Forex MAJORS

Cryptocurrencies

Signatures