EUR/USD bounces off lows post German GDP, around 1.10

• EUR/USD tests lows near 1.0990 pre-data.
• German Q3 GDP expanded 0.1% QoQ.
• EMU advanced Q3 GDP figures are coming up next.

The selling momentum around the European currency remains unabated and is dragging EUR/USD to fresh multi-week lows in the 1.0990 region on Thursday.

EUR/USD offered despite data, now looks to EMU GDP

The bearish note stays well and sound around the pair for the time being, finally breaking below the key support at 1.10 the figure on the back of solid USD-dynamics, some dovish ECB-speak and fresh trade concerns.

In the meantime, further selling impetus in spot came from the upbeat tone at Powell’s testimony on Wednesday, reinforcing the case for the ongoing ‘wait-and-see’ stance from the Fed and thus lending extra wings to the buck.

EUR has at least managed to halt the daily downside after the German economy avoided entering into recession in the third quarter. Indeed, the GDP expanded 0.1% during the third quarter and 1.0% on a yearly basis, both prints surprising to the upside.

Later in the session, another revision of Q3 GDP figures in the broader Euroland is due along with employment data for the euro area and the speech by ECB’s De Guindos.

Across the pond, Producer Prices will be closely watched seconded by weekly Initial Claims and another testimony by Fed’s Powell. Furthermore, FOMC’s Quarles, Clarida, Williams, Bullard, Evans, Daly and Kaplan are expected to speak throughout the day.

What to look for around EUR

The selling mood in the euro has intensified and dragged spot to fresh 4-week lows in the 1.1000/1/0990 region. As usual, the firm note in the greenback and developments from the US-China trade scenario are expected to dictate the mood around the pair for the time being. On the macro view, the outlook in Euroland remains fragile and does nothing but justify the ‘looser for longer’ monetary stance by the ECB and the bearish view on the single currency in the medium term at least. The fact that the German economy avoided recession in Q3 is expected to bring in some temporary relief to the euro.

EUR/USD levels to watch

At the moment, the pair is retreating 0.06% at 1.1000 and a break below 1.0994 (monthly low Nov.14) would target 1.0925 (low Sep.3) en route to 1.0879 (2019 low Oct.1). On the upside, the next hurdle lines up at 1.1035 (55-day SMA) followed by 1.1099 (100-day SMA) and finally 1.1179 (monthly high Oct.21).