EUR/USD records fresh highs around 1.1760 on USD-weakness

• EUR/USD gains further momentum and reaches tops near 1.1760.
• German Business Climate came in on the strong side in July.
• US Durable Goods Orders expanded 0.5% MoM during June.

The rally in EUR/USD remains unabated so far on Monday and is now testing fresh tops in the mid-1.1700s.

EUR/USD in fresh 22-month peaks

The persistent weakness around the greenback has allowed EUR/USD to advance further north of the 1.1700 mark and record at the same time new 22-month tops in the 1.1760/65 band, area last visited in September 2018.

Indeed, the combination of the firm sentiment in the risk complex plus persistent unwinding of USD longs – in favour of other safe havens – keep the buck under heavy pressure and the US Dollar Index in new lows near 93.60.

In the calendar, the IFO Survey showed the German Business Climate improved more than estimated at 90.5 in June, Further data saw the ECB’s Private Sector Loans expanded 3.0% in June from a year earlier, while the M3 Mone Supply expanded at an annualized 9.2% during the same period.

Across the pond, Durable Goods Orders expanded 7.3% inter-month in June, while Core orders expanded 3.3% MoM, a tad below consensus.

What to look for around EUR

EUR/USD advanced to levels last seen in September 2018 above 1.1700 earlier on Monday, confirming once again the solid momentum around both the single currency and the rest of its risky peers. The sharp move up, while largely triggered by dollar-selling, has found extra sustain in auspicious results from the domestic docket, in turn supporting further the view of a strong economic recovery following the coronavirus fallout. Also lending wings to the momentum around the euro, the recently clinched deal on the European Recovery Fund helped putting political fears within the region to rest (for now), while the solid position of the current account in the region adds to the rally.

EUR/USD levels to watch

At the moment, the pair is gaining 0.81% at 1.1748 and a breakout of 1.1764 (2020 high Jul.27) would target 1.1815 (monthly high Sep.24 2018) en route to 1.1852 (monthly high Jun.14 2018). On the downside, the next support aligns at 1.1495 (monthly high Mar.9) seconded by 1.1448 (50% Fibo of the 2017-2018 rally) and finally 1.1422 (monthly high Jun.10).