The upside break seen in the EUR/USD pair above 1.19 handle in Asia, appears to lack follow through, as the bulls remain on the defensive ahead of a fresh batch of macro release from the Euroland.
EUR/USD: Focus shifts to ECB decision
The major extends its side-trend into Europe, although the sentiment around the funding currency Euro remains, in response to looming North Korea missile threat, while persistent weakness seen in the US dollar versus its six major rivals also keeps the bid tone intact around the EUR/USD pair.
The greenback remains offered for the third straight trading session, consolidating a huge sell-off backed by disappointing US jobs data. Moreover, with the US markets closed yesterday, the buck was left confined in a narrow trading range, as attention now turns towards a series of Fedspeaks due later today for fresh insights on the US interest rates outlook.
Meanwhile, the common currency will also look forward to a slew of macro updates from the Euroland, including the final services PMI reports, retail sales and final Q2 GDP revision. Also, the sentiment around the European equities will also drive the EUR moves.
EUR/USD Technical Set-up
Karen Jones, Analyst at Commerzbank, explains: “EUR/USD as we suspected the rebound from the uptrend failed to regain the 1.200 level and our attention has reverted to the trend line support at 1.1841. We suspect that the market may have topped near term, but this will only be confirmed on a close below the uptrend. The new high has also been accompanied by a divergence of the daily RSI. Below the 2 month uptrend lies the 4 month uptrend at 1.1720.”
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