EUR/USD struggling for direction ahead of Thursday’s ECB decision

Haresh Menghani FXStreet

The EUR/USD pair traded with mild negative bias but was seen oscillating within a narrow trading range amid renewed greenback buying interest.

Currently trading around 1.0715-20 region, the pair struggled for a firm direction as investors seemed reluctant to initiate fresh positions and cautiously await for two of the most influential central bank monetary policy meetings, ECB on Thursday and FOMC on December 13-14.

Even Wednesday's disappointing release of German industrial production and larger-than-expected French trade deficit data failed to provide any impetus and the pair's consolidated Tuesday's reversal move, having failed to build on Monday's strong recovery move from multi-month lows.

Looking at the broader picture, despite of Tuesday's downslide from three week highs, the pair has managed to defend 1.0700 handle for the time being. Hence, only a decisive break back below the said handle might negate possibilities of any further near-term recovery and turn the pair vulnerable to resume with its prior depreciating move.

Technical levels to watch

Sustained weakness back below 1.0700-1.0690 immediate support now seems to drag the pair towards 1.0625 before the pair turns vulnerable and drop back below 1.0600 handle towards testing its next important support near 1.0535-30 region. On the upside, 1.0750 area seems to act as immediate hurdle above which the pair seems all set to aim towards 1.0800 handle.

1. R3 1.0860
2. R2 1.0823
3. R1 1.0772
PP 1.0735
1. S1 1.0684
2. S2 1.0648
3. S3 1.0597

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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