EUR/USD resumes the upside and still targets 1.2000

EUR/USD fades Thursday’s pullback and reclaims 1.1980.
The dollar looks offered amidst steady yields on Friday.
EMU’s final March CPI comes up next in the euro docket.

Pablo Piovano FXStreet

The single currency reverses the previous day’s pullback and regains the composure, lifting EUR/USD back to the 1.1980 region.

EUR/USD faces the next hurdle at 1.2000

EUR/USD’s rally remains well and sound and leaves behind Thursday’s downtick on the back of the offered bias surrounding the buck, which is in turn sponsored by declining yields in the US bond markets.

in fact, the risk-on sentiment prevails among investors, propelling stocks to fresh highs and sustaining the ongoing rebound in spot to the vicinity of the psychological barrier at 1.2000 the figure.

Also supporting the shared currency, market participants now shift their interest to the progress of the vaccine rollout in the Old Continent, adding to the positive growth prospects in the region in the second half of the year.

Data wise in Euroland, final March CPI figures in the broader euro area come up next ahead of the Eurogroup meeting. In the US calendar, housing data and the preliminary U-Mich index for the month of April are also due.

What to look for around EUR

EUR/USD keeps pushing higher and gradually approaches the psychological 1.2000 barrier in response to the increasing selling pressure in the dollar and fresh optimism on the economic rebound in the euro area now that the vaccine campaign appears to have gained some serious pace. Solid results from key fundamentals as of late also appear to bolster this shift in the investors’ view.

Key events in the euro area this week: Eurogroup meeting, EMU final CPI (Friday).

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 0.16% at 1.1983 and faces the next hurdle at 1.1993 (monthly high Apr.15) followed by 1.2000 (psychological level) and finally 1.2050 (100-day SMA). On the other hand, a breach of 1.1902 (200-day SMA) would target 1.1762 (78.6% Fibo of the November-January rally) en route to 1.1704 (2021 low Mar.31).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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