Search ForexCrunch
  • EUR/USD advances further to monthly tops around 1.1040.
  • Advanced US Q1 GDP came in below expectations at -5.0%.
  • German flash CPI contracted 0.1% on a monthly basis in May.

The bid tone around the European currency stays well and sound for another session on Thursday and is now lifting EUR/USD to new monthly tops around 1.1040.

EUR/USD faces extra gains above 1.1000

EUR/USD is up for the third straight session on Thursday and is looking to consolidate further the breakout of the psychological barrier at 1.10 the figure, always on the back of persistent weakness surrounding the buck.

Adding extra downside pressure to the dollar, the second estimate of the US Q1 GDP showed the economy is now seen shrinking at a yearly 5.0%, while Initial Claims topped 2 million citizens during last week.

On the not-so-negative side, Continuing Claims rose a tad above 21 million and headline Durable Goods Orders contracted 17.2%, both prints coming in above previous estimates.

What to look for around EUR

EUR/USD has finally managed to reclaim the 1.1000 barrier and above, initially allowing for the continuation of the uptrend, at least in the very near term. In the meantime, USD-dynamics and US-China trade effervescence keep driving the sentiment in the global markets. On the domestic scenario, the euro is deriving extra oxygen from news of an aid package proposed by the European Commission as well as progress on the re-opening of economies in the Old Continent. Further legs for the pair can be found in the solid position of the euro area’s current account.

EUR/USD levels to watch

At the moment, the pair is advancing 0.29% at 1.1035 and a break above 1.1040 (monthly high May 28) would target 1.1147 (weekly high Mar.27) en route to 1.1186 (61.8% Fibo of the 2017-2018 rally). On the other hand, immediate contention emerges at 1.0870 (weekly low May 26) seconded by 1.0774 (weekly low May 14) and finally 1.0727 (monthly low Apr.24).