- EUR/USD moves to weekly tops beyond the 1.18 mark.
- Final Services/Composite PMIs in the euro area next on tap.
- US ADP, ISM Non-Manufacturing coming up next in the NA session.
The single currency has regained the smile in the last couple of sessions and is now lifting EUR/USD to the upper end of the weekly range above the 1.18 yardstick.
EUR/USD focused on domestic/US data
EUR/USD is up for the second straight session on Wednesday, adding to the resumption of the buying bias beyond 1.18 the figure and, as usual, on the back of the offered stance in the buck.
Speaking about the dollar, all the attention remains on US lawmakers amidst the rising debate around an extra stimulus package to counteract the impact of the pandemic on US households.
In the euro docket, final July Services PMI came in below the preliminary prints, albeit all of them stayed in the expansion territory (>50). Still in the region, June’s Retail Sales are expected to have expanded by around 6% from a month earlier, markedly below May’s gain of nearly 18%.
Across the ocean, the ADP report is due followed by Trade Balance figures and July’s ISM Non-Manufacturing.
What to look for around EUR
EUR/USD regained some poise following the corrective downside after reaching +2-year peaks beyond the 1.19 mark at the end of last week. The sharp move up, while largely triggered by broad-based 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 0.13% at 1.1817 and a breakout of 1.1909 (2020 high Jul.31) would target 1.1996 (high May 14 2018) en route to 1.2032 (23.6% Fibo of the 2017-2018 rally). On the downside, immediate contention emerges at 1.1709 (38.2% Fibo of the 2017-2018 rally) followed by 1.1495 (monthly high Mar.9) and finally 1.1448 (50% Fibo of the 2017-2018 rally).
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