- EUR/USD pushes further north of the 1.1800 mark on Wednesday.
- The selling pressure in the dollar intensifies amidst risk-on mood.
- ECB-speak Fed’s Beige Book take centre stage later in the session.
The buying pressure around the single currency remains well and sound for yet another session and lifts EUR/USD to new multi-week highs in the 1.1860/65 band on Wednesday.
EUR/USD stronger on risk appetite, looks to data, USD
EUR/USD advances for the fourth consecutive session on Wednesday and consolidates the upside momentum following the recent breakout of the interim hurdle at the 55-day SMA just below 1.1800 the figure.
The persistent and strong selling bias surrounding the greenback remains behind the pair’s sharp rebound from last week’s lows in the 1.1690 zone, always fuelled by increasing inflows into the risk complex.
Indeed, rising hopes of extra fiscal stimulus in the US economy coupled with consensus around a “blue wave” at the November elections continue to weigh on the buck and drag the US Dollar Index (DXY) to levels last seen in late September near 92.70.
Later in the euro docket, the focus of attention will be on the participation of ECB’s C.Lagarde at an ECB Listens event. Additionally, ECB’s board members L.De Guindos and P.Lane are also due to speak.
What to look for around EUR
EUR/USD extends the bounce off last week’s lows in the 1.1690/85 band and already navigate in multi-week peaks well above 1.1800. The outlook on EUR/USD 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 (despite momentum appears somewhat mitigated in several regions), the so far cautious stance from the ECB and the solid position of the EMU’s current account. In addition, the probable “blue wave” following the US elections is deemed as a negative driver for the greenback and carries the potential to lend extra legs to the pair in the longer run.
EUR/USD levels to watch
At the moment, the pair is gaining 0.30% at 1.1857 and a breakout of 1.1862 (monthly high Oct.21) would target 1.1917 (high Sep.10) en route to 1.1965 (monthly high Aug.18). On the other hand, the next support is located at 1.1688 (monthly low Ot.15) followed by 1.1612 (monthly low Sep.25) and finally 1.1495 (monthly high Mar.9).
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