Search ForexCrunch
  • The pair’s upside faltered near 1.1170 in early trade.
  • DXY recovers poise and flirts with the 98.00 handle.
  • Upcoming US data releases include PCE, Personal Income/Spending.

The shared currency keeps the positive stance well and sound so far on Monday despite EUR/USD is now returning to the mid-1.1100s after testing Friday’s tops around 1.1170.

EUR/USD now looks to US data

Spot is up for the second session in a row at the beginning of the week, trying to put further distance from last week’s new YTD lows just above 1.1100 the figure.

In fact, some selling pressure around the buck emerged in the wake of mixed results from the US docket on Friday, allowing a respite in the beleaguered risk-associated universe and a rebound in the pair.

Earlier in the day, the BCE’s M3 Money Supply expanded 4.5% on a year to March and Private Sector Loans rose 3.2% YoY. In addition Business Climate in the euro bloc slipped back to 0.42 in April and Consumer Confidence dropped to -7.9.

Later in the NA session, US inflation figures tracked by the PCE are due seconded by Personal Income/Spending for the month of March.

What to look for around EUR

The broad-based risk-appetite trends and USD-dynamics are posed to rule the sentiment surrounding the European currency for the time being, all in combination with the onoging US-China trade dispute and potential US tariffs on EU products. Recent weak results from key fundamentals in the region plus a now unlikely rebound in the activity in the second half of the year have added to the prevailing concerns that the slowdown in the region could last longer that initially estimated and the ECB is therefore likely to remain ‘neutral/dovish’ for the foreseeable future (say until mid-2020?). On the political front, headwinds are expected to emerge in light of the upcoming EU parliamentary elections in late May, as the populist option in the form of the far-right and the far-left movements appears to keep swelling among voting countries.

EUR/USD levels to watch

At the moment, the pair is up 0.09% at 1.1149 and a breakout of 1.1174 (high Arp.26) would target 1.1230 (21-day SMA) en route to 1.1280 (55-day SMA). On the flip side, initial contention emerges at 1.1109 (2019 low Apr.26) seconded by 1.0839 (monthly low May 11 2017) and finally 1.0569 (monthly low Apr.10 2017).