EUR/USD: Will the buyers regain control above 1.1140?
The EUR/USD pair remains confined within a narrow, with several upside attempts capped near 1.1140 region, while the downside remains cushioned at 1.1128.
EUR/USD: Will it break from the range-play?
The spot trades modestly flat so far this session, with the risks tilted to the downside amid renewed USD buying across the board, as monetary policy divergence between both continents remains in play. The recent hawkish Fedspeaks continue to bolster expectations of further rate rises this year, while the ECB continues to downplay tapering hopes amid softer inflation outlook.
Further, the major remains side-lined, as the investors refrain from creating fresh positions ahead of the Queen’s Mansion House speech, which will have a major impact on the EUR/GBP cross, eventually having a “rub-off” effect on the Euro.
However, the losses remain limited amid persisting risk-off moods, in the wake of tumbling European equities and oil prices, which continue to lend support to the funding currency Euro. Also, subdued trading activity seen behind Treasury yields, keeps the rate somewhat buoyed.
Next of relevance for the major remains the US existing home sales data that will fill in an otherwise light economic calendar today.
EUR/USD Technical Levels
Slobodan Drvenica at Windsor Brokers Ltd: “Near-term outlook is bearish after strong fall in past two days and marginal close below former higher base at 1.1135, as bears dented next strong support at 1.1121(Fibo 38.2% of 1.0839/1.1295 upleg). Profit-taking on larger uptrend and stronger dollar are seen as pair’s main drivers, with increased risk of deeper correction towards 1.1067/13 (Fibo 50% and 61.8% retracement of 1.0839/1.1295 upleg) seen on sustained break below of 1.1121/09 pivots.”
“Bear-cross of 10/20SMA’s maintains near-term bearish pressure, with falling 10SMA offering solid resistance at 1.1179 and guarding upper pivot at 1.1202, provided by 20SMA. Res: 1.1138; 1.1165; 1.1179; 1.1202 Sup: 1.1121; 1.1109; 1.1067; 1.1013,” Slobodan added.