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  • The pair moves higher and visits the 1.1350 region.
  • The greenback trades on the defensive below 96.50.
  • EMU Trade Balance next on tap in the docket.

The optimism around the European currency remains well and sound on Monday and is now helping EUR/USD to advance to fresh 2-week highs in the 1.1350 area.

EUR/USD looks to trade, risk trends

The pair is adding to Friday’s gains above 1.1300 the figure today against the backdrop of the persistent offered bias surrounding the greenback.

In the meantime, investors continue to look to the broader risk appetite trends for direction, where the US-China trade dispute and the Brexit negotiations remain in the centre of the debate for the time being.

In today’s calendar, Trade Balance figures for the month of January are only due in Euroland along with the speech by ECB’s L. De Guindos, and P.Praet.

What to look for around EUR

Market participants appear to have already adjusted to the recent and renewed dovish stance from the ECB, focusing instead on the broad risk-appetite trends as the main driver of the price action in the near term. In the longer run, the performance of the economy in the region should remain in centre stage along with prospects of re-assessment of the ECB’s monetary policy. In this regard, it is worth mentioning that investors keep pricing in the first rate hike by the central bank at some point in H2 2019. On the political front, headwinds are expected to emerge in light of the upcoming EU parliamentary elections, where the focus of attention will be on the potential increase of the populist option among voters.

EUR/USD levels to watch

At the moment, the pair is gaining 0.20% at 1.1346 facing the next hurdle at 1.1365 (55-day SMA) seconded by 1.1419 (high Feb.14) and finally 1.1484 (200-day SMA). On the other hand, a break below 1.1286 (10-day SMA) would target 1.1176 (2019 low Mar.7) en route to 1.1118 (monthly low Jun.20 2017).