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  • EUR/USD pushes higher and tests 1.2140, new 32-month highs.
  • Vaccine news, stimulus hopes sustain the upside in the pair.
  • German, EMU Services PMI remain within the contraction territory.

The upside momentum in the European currency remains well and sound and lifts EUR/USD to new peaks in the 1.2140 zone.

EUR/USD bolstered by risk appetite trends

EUR/USD extends the rally well above the key barrier at 1.21 the figure on Thursday, as investors’ appetite for the risk-associated assets remains firm.

In fact, rising rumours of extra US fiscal/monetary stimulus under the Biden’s administration in combination with optimism stemming from an effective COVID-19 vaccine continue to underpin the inflows into the risk complex in past weeks, all in detriment of the dollar.

In the docket, November’s final Services PMI in the core Euroland (France, Germany and the euro area) remained within the contraction territory (below the 50 threshold). Later in the session, Retail Sales in the bloc for the month of October are due.

Across the pond, the usual weekly Initial Claims will take centre stage seconded by the ISM Non-Manufacturing and final Markit’s Services PMI, both for the month of November.

What to look for around EUR

Another day, another top in EUR/USD. In fact, this time the pair managed to leave behind the 1.2100 barrier and clinched peaks in levels last seen in April 2018 near 1.2140, always against the backdrop of a favourable atmosphere in the risk complex. In the very near-term, EUR/USD appears supported by prospects of a strong recovery in the region along with the increasing likelihood of extra stimulus in the US. Risks to this positive view emerge from the potential political effervescence around the EU Recovery Fund and increasing chances of further ECB easing to be announced as soon as at the December meeting.

EUR/USD levels to watch

At the moment, the pair is retreating 0.01% at 1.2102 and faces the next support at 1.1920 (high Nov.9) seconded by 1.1800 (low Nov.23) and finally 1.1745 (weekly low Nov.11). On the flip side, a breakout of 1.2139 (2020 high Dec.3) would target 1.2413 (monthly high Apr.17 2018) en route to 1.2476 (monthly high Mar.27 2018).