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  • EUR/USD gathers extra pace and tests highs at 1.1370.
  • The risk-on sentiment remains well and sound among investors.
  • German trade surplus widened to €7.6 billion in May.

The optimism around the shared currency stays well and sound and it has lifted EUR/USD to fresh highs around 1.1370 on Thursday.

EUR/USD focused on data, risk trends

EUR/USD is posting gains for the second straight session on Thursday, managing at the same time to break above the key barrier at 1.13 the figure and open the door to a potential move to the 1.14 mark and possibly beyond.

The solid move from investors towards the riskier assets puts the buck under extra downside pressure and forces the US Dollar Index (DXY) to recede to multi-week lows, all within the generalized upbeat context for stocks and commodities.

Earlier in the session, the German trade surplus expanded to €7.6 billion in May (from €3.4 billion)), with Exports and Imports expanding by 9.0% and 3.5%, respectively. The Current Account surplus, on the flip side, shrunk to €6.5 billion in the same period (from €9.1 billion). Later, the EuroGroup meeting is expected to appoint a new President following the resignation of Mario Centeno in early June.

Data across the pond will include the usual Initial Claims as well as Wholesale Inventories for the month of May. In addition, Atlanta Fed R.Bostic (2021 voter, centrist) is due to speak.

What to look for around EUR

EUR/USD managed to advance to fresh multi-week peaks around 1.1370, always supported by the solid improvement in the risk-associated universe. The constructive view in the euro, in the meantime, stays well and sound and supported by the improvement of key fundamentals in the region amidst the current (and massive) monetary stimulus by central banks. On top, the solid performance of the region’s current account is also adding to the attractiveness of the shared currency.

EUR/USD levels to watch

At the moment, the pair is gaining 0.23% at 1.1355 and a break above 1.1370 (monthly high Jul.9) would target 1.1422 (monthly high Jun.10) en route to 1.1495 (2020 high Mar.9). On the other hand, immediate contention emerges at 1.1168 (monthly low Jun.19) seconded by 1.1147 (high Mar.27) and finally 1.1045 (200-day SMA).