EUR/USD off 4-week highs, recedes to 1.0630 ahead of ECB

Dhwani Mehta FXStreet

The offered tone behind the US dollar weakened a bit over the last hour, prompting a minor-sell-off in EUR/USD from four-week tops reached beyond 1.0650 levels.

EUR/USD back below 1.0650

Currently, the spot trades +0.45% higher at 1.0631, reversing sharply towards 1.06 handle. EUR/USD rally ran out of steam in the European session, as the greenback witnessed some fresh demand at lower levels versus its major rivals, driving the USD index back above 101 handle.

However, the spot manages to cling onto gains as the euro remains supported amid negative performance on the European indices, which triggered a fresh risk-aversion wave and boosted its demand as a funding currency. While upbeat German Q4 GDP data also keeps the bid tone intact around the major.

The immediate focus now remains on the Eurozone industrial production data due to be reported shortly, while ECB monetary policy accounts may provide some fresh impetus to the EUR this session. ECB meeting accounts to be scrutinised for tapering hints – RBC CM

EUR/USD Technical Levels

In terms of technicals, the pair finds the immediate resistance 1.0665 (4-week high). A break beyond the last, doors will open for a test of 1.0700 (round figure) and from there to 1.0750 (psychological levels). On the flip side, the immediate support is placed at 1.0574 (5-DMA) below which 1.0536 (10-DMA) and 1.0500 (20-DMA) could be tested.

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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