- EUR/USD’s positive momentum struggles near 1.1780.
- ECB’s Lagarde says ample stimulus is still needed.
- FOMC Minutes coming up next in the US docket.
EUR/USD appears to have met quite a tough hurdle in the 1.1780 so far on Wednesday.
EUR/USD looks to USD, risk trends
EUR/USD keeps the daily topside unchanged despite bulls have so far failed to push spot further north of the 1.1780 region (or the 1.1800 level on a weekly basis).
The euro remains apathetic after ECB’s Lagarde said that the region risks extra divergence in the wake of the coronavirus crisis. Lagarde also reiterated that ample stimulus is still needed and warned against its premature withdrawal. She stressed that the recovery of the euro area remains long and uncertain.
In the US docket, all the attention will be on the publication of the FOMC Minutes later in the NA session.
What to look for around EUR
EUR/USD appears to have met a strong barrier in the 1.1800 area so far, where converge the 55-day SMA and just above the immediate resistance line. The pair’s outlook still remains constructive and bearish moves are deemed as corrective only. Further out, the positive bias in the euro remains underpinned by auspicious results from domestic fundamentals (which have been in turn supporting further the view of a strong economic recovery after the slump in the activity during the spring), the so far cautious stance from the ECB and the solid position of the EMU’s current account.
EUR/USD levels to watch
At the moment, the pair is gaining 0.36% at 1.1775 and a break above 1.1807 (weekly high Oct.6) would target 1.1917 (high Sep.10) en route to 1.1965 (monthly high Aug.18). On the flip side, the pair faces immediate contention at 1.1709 (38.2% Fibo of the 2017-2018 rally) seconded by 1.1612 (monthly low Sep.25) and finally 1.1495 (monthly high Mar.9).
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