- The pair comes under renewed selling pressure near 1.1420.
- The demand for the greenback gathers traction and lifts DXY.
- US Consumer Confidence next of relevance in the docket.
The selling bias around the single currency is now picking up pace and is forcing EUR/USD to recede to session lows near 1.1420.
EUR/USD now looks to data, Brexit
After climbing to fresh tops near the key 100-day SMA in the mid-1.1400s, spot met fresh sellers and sparked a correction lower to the current 1.1420 region, all amidst the generalized cautious mood in the global markets.
In fact, investors keep looking to the upcoming US-China trade talks (Wednesday and Thursday) and the FOMC meeting (Wednesday) for near term direction, with special attention on the message from Chief J.Powell regarding the Fed’s rate path this year.
In the data universe, Spanish unemployment ticked higher to 14.45% in Q4 2018, and Italian Producer Prices contracted at a monthly 0.5% and rose 4.1% on a year to December. Across the Atlantic, house prices tracked by the S&P/Case-Shiller index and the key Conference Board’s Consumer Confidence are also due later.
What to look for around EUR/USD
Following the recent ECB event and Draghi’s comments, the central bank is expected to enhance its data-dependency stance in the next months in light of the ongoing slowdown in the region. In addition, the US-China trade talks will also be on the investors’ radar this week ahead of the meeting between US and Chinese officials on Wednesday and Thursday. On the more political side, the upcoming EU parliamentary elections (May) should start to grab extra attention in the next weeks, with special attention on the advance of the populist option among potential candidates.
EUR/USD levels to watch
At the moment, the pair is losing 0.04% at 1.1421 and a breach of 1.1414 (21-day SMA) would target 1.1382 (10-day SMA) en route to 1.1289 (2019 low Jan.24). On the flip side, the next hurdle emerges at 1.1448 (100-day SMA) seconded by 1.1550 (50% Fibo of the September-November drop) and finally 1.1569 (2019 high Jan.9).
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