EUR/USD extends post-ECB recovery, 1.1300 on sight

EUR/USD extends its steady recovery mode into mid-Asia, as dust settles over the ECB disappointment. Markets digest the latest macro news from China amid prevalent risk-off markets.

EUR/USD finds solid support near 20-DMA at 1.1236

Currently, EUR/USD trades +0.18% higher and flirts with fresh session highs printed at 1.1280 last minutes. The main currency pair stalled its post-ECB sell-off just ahead of 20-DMA and from there reversed course in bid to reclaim 1.1300 levels.

The recovery witnessed in EUR/USD is mainly driven by a corrective slide in the greenback against its major peers, which is triggered by falling US treasury yields in response to uncertainty over the timing of the next Fed rate hike this year. The USD index keeps pushing lower, now down -0.18% around session lows of 94.84.

On Thursday, the ECB kept its monetary policy settings unadjusted, disappointing markets’ expectations of an extension in the bond-buying programme beyond March 2017. Next of note for the major remains the German trade data lined up for release ahead of Europe open. Besides, Fed official Rosengren’s speech will be also closely heard for fresh insights on the US interest rates outlook.

EUR/USD Technical Levels               

In terms of technicals, the pair finds the immediate resistance 1.1300 (round number). A break beyond the last, doors will open for a test of 1.1343 (Aug 28 high). On the flip side, the immediate support is placed at 1.1236 (20 & 5-DMA) below which 1.1200 (10-DMA) could be tested.