EUR/USD reverses and prints fresh highs after reports on North Korea

Matías Salord FXStreet

EUR/USD bounced sharply from the lows and rose 50 pips during the last hour after reports of a potential missile test from North Korea this weekend. The pair broke above 1.1715 and printed a fresh daily high at 1.1737.

North Korea is ready to test a missile capable of reaching the U.S. West Coast - Sputnik

USD losses strength, EUR remains resilient

The euro was showing signals of resilient posting gains across the board after the US payrolls report. Despite the US rally, EUR/USD fell modestly. The increase in market odds of a rate hike from the Fed in December pushed the greenback to the upside.

US: Storm-skewed report means nothing about anything – BBH

The report about North Korea boosted the yen and weakened the US dollar ahead of the weekend. The euro remains strong, although, it retreated versus the Swiss franc.

Technical levels

The pair is back above the relevant 1.1700 zone and now, short-term momentum favors the upside. It is still too soon to see if it could be the start of a bullish run for the pair and so far the overall tone still favors the US dollar.

ERU/USD is likely to face resistance at 1.1750 and then at 1.1785 (weekly highs) before the 1.1800 area.

On the flip side, a decline back below 1.1700 could add pressure to the euro exposing the 1.1680 area, and then 1.1655/60 (August low).

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

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