The renewed offered tone around the greenback is now lifting EUR/USD to the area of daily highs near 1.0640.
EUR/USD firmer on USD-selling
Spot gained over a cent since yesterday’s lows in the 1.0520 region, as the Yellen—induced rally in the buck continued to unwind following the opening bell in Euroland on Thursday.
The pair has retreated to fresh multi-week lows near 1.0520 in response to a strong pick up in the demand for the US Dollar, which has been bolstered by the hawkish message by Chief J.Yellen at her testimony on Tuesday and positive results from US inflation figures and Retail Sales during the last month. In addition, the greenback found extra legs in supportive comments from FOMC governors, who in general subscribed to the idea of three (or more) rate hikes during 2017.
In the data space, recent poor readings from EMU’s advanced Q4 GDP and the ZEW Survey in both Germany and the euro area seem to have passed unnoticed by traders, who remain focused on USD-dynamics as the exclusive driver for the pair’s price action.
Today the ECB will publish its Accounts from the latest meeting, while Housing Starts, Building Permits and the Philly Fed manufacturing index are all due later in the US calendar.
EUR/USD levels to watch
At the moment the pair is gaining 0.27% at 1.0628 facing the next resistance at 1.0658 (high Feb.13) followed by 1.0698 (20-day sma) and finally 1.0706 (38.2% Fibo of the November-January drop). On the flip side, a break below 1.0520 (low Feb.15) would target 1.0452 (low Jan.11) en route to 1.0339 (2017 low Jan.3).