EUR/USD peeps above 1.19 on persistent USD sell-off

• EUR/USD prints 25-month high above 1.19 as USD selling persists. 
• Growth concerns and fiscal impasse weigh over the greenback. 
• EUR/USD’s daily RSI shows overbought conditions, may induce some profit-taking.

Dour US data and fiscal impasse in Washington continues to weigh over the US dollar and push EUR/USD higher. 

The pair is trading at 1.1886 at press time, having put in a 25-month high of 1.1905 a few minutes ago. 

Greenback on the offer

Bears continue to tighten their grip around the US dollar with the economic data raising concerns regarding the future course of the world’s largest economy. 

The official data released on Thursday showed more than 1.4 million workers in the US applied for state unemployment benefits last week. The second consecutive rise in jobless claims validated the Federal Reserve’s warning on Wednesday that the recovery was slowing due to the resurgence of coronavirus cases. 

Another data revealed that the US economy contracted by a record 32.9% in the second quarter. 

If that’s not enough, the Congress remains deadlocked on a new fiscal support bill even though an enhanced federal jobless benefit is set to expire on Friday.

These factors could continue to weigh over the US dollar during the day ahead. Investors, however, should note that the pair now looks extremely overbought and bond yields in the Eurozone are also falling on growth concerns. As such, a sudden pullback cannot be ruled out. 

On the data front, the focus would be on the German Retail Sales (Jun), Eurozone’s preliminary second-quarter GDP data, and Consumer Price Index for July, Across the pond, the US Core Personal Consumption Expenditure. 

Technical levels