EUR/USD looks to close day above 1.20, up more than 150 pips on week

The EUR/USD pair was able to build on yesterday's gains during the first half of the day and refreshed its highest level since January 2015 at 1.2090 before retreating in the NA session. As of writing, the pair was trading at 1.2035, up 0.11% on the day.

The majority of this week's earnings came on Thursday after the ECB President Draghi's remarks at the press conference following the Governing Council meeting. Draghi signaled that the ECB was looking to make an update to the asset purchase program in October. Although he also added that the euro's recent strength was causing concerns, investors focused on pricing a tightening move, allowing the pair to add more than 100 pips on the day. On a weekly basis, the pair is trading 150 pips above its opening level.

• ECB: Broad based and solid economic recovery led to discussions about asset purchase program - Rabobank

On the other hand, the greenback remained under pressure as Hurricane Irma forced investors to seek refuge in safe-havens like the US Treasury-bonds, weighing on the yields and dragging the US Dollar Index lower. When the yield of 10-year T-bonds dropped to its lowest level since November at %2.016 in the early European session, the DXY touched the 91 mark for the first time in more than 30 months. Despite a modest recovery in the late NA session, the index is still losing 0.2% at 91.30.

Technical outlook

Valeria Bednarik, Chief Analyst at FXStreet, writes, "January 2015 high stands at 1.2101, the immediate resistance for the upcoming week. Steady gains above the level expose the 1.2330 price zone, where the pair had multiple monthly highs and lows from the past decade. In the way, an intermediate resistances can be found at 1.2240. July's high at 1.1910 is the main mid-term support, followed by 1.1822. Below this last, a downward corrective movement could extend down to the 1.1750 region, although such strength in the greenback has no bases at the time being."

• EUR still not overvalued – Rabobank
• Strong growth and creditor status protects EUR - Rabobank