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  • EUR/USD moves within the familiar range in the mid-1.1100s.
  • ECB’s President M.Draghi speaks later in the day.
  • Attention will also be on the release of the FOMC minutes.

The selling pressure around the shared currency remains well and sound so far this week and is now taking EUR/USD to once again test the mid-1.1100s.

EUR/USD does not rule out a test of 1.1100

Spot is down for the second session in a row following Monday’s unsuccessful bullish attempt and yesterday’s bull run to the 1.1180 region.

In the meantime, trade concerns stemming from the US-China dispute keep dictating the price action and the sentiment in the global markets and stay unabated despite the Trump’s administration lifted the ban on Chinese tech Huawei for 90 days on Tuesday.

Moving forward, still no significant releases in Euroland should leave the bulk of attention to the speeches by President M.Draghi and Board member P.Praet. Across the Atlantic, the FOMC will publish the minutes from its last meeting, while Fed’s Williams and Bostic are also due to speak.

What to look for around EUR

Recent data releases in Euroland and Germany have poured cold water over the idea that some healing process could be under way in the region, re-shifting the focus to the ongoing slowdown and its probable duration and extension. In the meantime, the current ‘neutral/dovish’ stance from the ECB is expected to persist for the remainder of the year and probable through H1 2020. The broad-based risk-appetite trends and USD-dynamics should dictate the sentiment surrounding the European currency for the time being, all in combination with the now stalled US-China negotiations and potential US tariffs on EU products. On the political front, Italy has re-emerged as a source of uncertainty and volatility, while investors’ focus has now shifted to the EU parliamentary elections due later this week.

EUR/USD levels to watch

At the moment, the pair is losing 0.04% at 1.1154 and faces the next support at 1.1135 (low May 3) seconded by 1.1109 (2019 low Apr.26) and finally 1.0839 (monthly low May 2017). On the other hand, a break above 1.1217 (23.6% Fibo of the 2019 drop) would target 1.1237 (55-day SMA) en route to 1.1264 (high May 1).