- The pair remains sidelined following recent peaks above 1.14.
- The greenback adds to the ongoing rebound from recent lows.
- EMU flash CPI figures next of relevance in the euro docket.
The lack of direction in the shared currency is prompting EUR/USD to remain sidelined within a tight range in the 1.1370 region today.
EUR/USD looks to EMU data, US ISM
After clinching fresh 3-week highs above 1.1400 the figure on Thursday, the lack of follow through among investors forced spot to give away those gains and retreat to the current 1.1370/60 band.
Better-than-expected US Q4 GDP figures published yesterday gave further respite to the greenback and collaborated with the rebound in the US Dollar Index from multi-week lows in the 95.80 area.
In the meantime, risk appetite trends continue to look to the US-China trade talks, where speculations of a potential deal are on the rise in light of the upcoming meeting between President Trump and China’s Xi Jinping later in the month.
In the data space, advanced inflation figures in Euroland are next of importance alog with final manufacturing PMIs for the month of February. Across the ocean, the ISM Manufacturing will grab all the attention, seconded by Core PCE and the U-Mich gauge.
What to look for around EUR
The recent upbeat momentum in the single currency has been almost exclusively in response to USD weakness. In the meantime, EUR continues to look to developments from the US-China trade talks for near term direction, while the effervescence on the US-EU trade front appear somewhat relegated so far. Today’s flash inflation figures in Euroland are unlikely to move the dial of the ECB’s forward guidance, which keeps signalling a cautious stance amidst the ongoing slowdown in the region and prospects of a ‘no hike’ this year.
EUR/USD levels to watch
At the moment, the pair is losing 0.04% at 1.1366 and faces the next support at 1.1356 (23.6% Fibo of the September-November drop) seconded by 1.1350 (10-day SMA) and finally 1.1275 (low Feb.19). On the upside, a break above 1.1419 (high Feb.28) would target 1.1442 (38.2% Fibo of the September-November drop) en route to 1.1508 (200-day SMA).