• The common currency continues to be weighed down by concerns over the region’s economic health.
• Today’s disappointing German Ifo index adds to the recent dismal data and prompts some selling.
• A modest USD uptick remained capped amid weaker US bond yields and helped limit deeper losses.
The EUR/USD pair dropped to three-day lows in the last hour, albeit quickly recovered few pips and is currently placed in the neutral territory, around the 1.1330 region.
A modest US Dollar weakness, against the backdrop of the previous session's softer US economic data, did assist the pair to gain some positive traction. The attempted up-move was once again sold into following the disappointing release of German Ifo Business Climate index, which missed consensus estimates and fell to 98.5 for February.
The incoming dismal Euro-zone economic data continued fueling concerns over the health of the region's economy and kept exerting some downward pressure on the shared currency, with the release of mostly in line final Euro-zone consumer inflation figures failing to lend any support.
Meanwhile, some renewed greenback buying over the past hour or so added to the selling bias and dragged the pair to an intraday low level of 1.1316. However, a subdued/weaker action around the US Treasury bond yields, amid firming expectations that the Fed might refrain from raising interest rates further, kept a lid on any strong follow-through USD uptick and helped limit deeper losses.
Moving ahead, there isn't any major market-moving economic data due for release and hence, the key focus will be on scheduled speeches by FOMC members, which might influence the USD price dynamics and eventually produce some meaningful trading opportunities on the last trading day of the week.
Technical levels to watch
Yohay Elam, FXStreet's own Analyst offers important technical levels to be considered for trading the major: “1.1350 remains a battle line, capping euro/dollar early in the day. 1.1372 was the high point this week and serves as a considerable resistance line. 1.1390 and 1.1405 worked as support lines in January and now await the pair as resistance.”
“EUR/USD may find initial support at 1.1330, the low of the day, followed by 1.1320, which was a bottom earlier this week. 1.1295 worked in both directions earlier in February and 1.1275 was the trough this week. 1.1250 and 1.1235 are next down the line,” he added further.
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