- EUR/USD builds on last week’s strong gains on Monday.
- USD selloff helps the pair preserve its bullish momentum.
- Focus remains on ECB’s policy meeting on Thursday.
The EUR/USD pair opened the week with a small bullish gap and rose above 1.1150 for the first time since late March. Although the pair edged lower toward 1.1100 during the European trading hours, it turned north during the American session. As of writing, the pair was up 0.26% on the day at 1.1128 and was looking to close the sixth straight in the positive territory.
Most major European markets were closed in observance of Whit Monday and the trading activity remained subdued for the large part of the day.
USD starts new week on a weak note
The data from the US revealed that the ISM Manufacturing PMI in May improved to 43.1 in May from 41.5 in April to come in slightly worse than the market expectation of 43.6. Nevertheless, Wall Street’s main indexes moved into the positive territory after starting the day slightly lower and made it difficult for the USD to find demand.
With the US Dollar Index (DXY) dropping below 98, the pair started to climb higher in the second half of the day. At the moment, the DXY is down 0.43% at 97.87.
There won’t be any significant macroeconomic data releases featured in Tuesday’s economic calendar. The next important event for the shared currency will be the European Central Bank’s monetary policy announcements on Thursday.
Previewing the ECB meeting, “the focus of the June meeting will likely be the expansion of the PEPP that the ECB has telegraphed,” said TD Securities analysts. “We’re onside with consensus in looking for an increase of €500bn, leaving the PEPP running into 2021.”
Technical levels to watch for
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