- The pair is looking to extend weekly gains and targets the 1.1300 handle.
- The greenback appears sidelined around the 97.00 handle.
- EMU Industrial Production coming up next.
The upbeat sentiment around the shared currency remains well and sound so far on Wednesday, pushing EUR/USD to the proximity of the critical barrier at 1.1300 the figure.
EUR/USD looks to Brexit, data
The pair exchanges gains with losses on Wednesday following a promising start of the week, including a brief test of the 1.1300 neighbourhood on Tuesday, although the move lacked of follow thorugh.
As usual, USD-dynamics continue to drive the price action around the pair almost exclusively while investors keep waiting for stronger signals on the US-China trade front and are closely following the developments in the Brexit negotiations.
In the data space, Spanish final CPI figures for the month of February are due later seconded by the more relevant data from the industrial sector in the broader euro bloc. Across the ocean, Durable Goods Orders are next on tap followed by February’s Producer Prices.
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 losing 0.02% at 1.1283 facing the next support at 1.1176 (2019 low Mar.7) followed by 1.1118 (monthly low Jun.20 2017) and finally 1.1021 (high May 8 2017). On the upside, a break above 1.1304 (high Mar.12) would target 1.1311 (21-day SMA) en route to 1.1369 (55-day SMA).
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