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  • EUR/USD manages well to keep business above the 1.1200 mark.
  • Alternating risk trends continue to look to the coronavirus developments.
  • ECB’s Christine Lagarde said the recovery will be ‘incomplete’.

The shared currency remains under pressure on Friday, with EUR/USD navigating the area just above 1.1200 the figure following the opening bell in the Old Continent.

EUR/USD looks to coronavirus, data

Following two consecutive daily pullbacks, EUR/USD is now attempting to reverse the negative streak amidst alternating risk appetite trends in the global market.

As usual in past weeks, investors are closely watching the developments from the coronavirus and the performance of the gradual return to the normal economic activity as the main drivers of assets’ price action and global sentiment.

In the docket, French Consumer Confidence improved to 97 in June, while German Import Prices rose at a monthly 0.3% in May. In addition, ECB’s C.Lagarde warned markets against a potential second wave of the pandemic while she also hinted at the possibility that the region could have already left behind the worst of the coronavirus crisis. Still with Lagarde, she also noted that the recovery is expected to be incomplete and a complicated matter.

Back to the ECB, Board member O.Rehn warned against the probability of the resurgence of deflation in the region at the time when he defended the central bank’s policies deeming them as necessary and appropriate.

In the NA session, the focus of attention will be on the PCE figures, Personal Income/Spending and the final June U-Mich print.

What to look for around EUR

EUR/USD appears to have met some important resistance in the 1.1350 region so far this week. In the meantime, investors continue to look to the gradual return to some sort of normality in the Old Continent as well as rising concerns over the probability of a second wave of coronavirus contagion. The constructive view in the euro, however, remains well sustained by the gradual and relentless re-opening of economies in Europe, positive results from fundamentals in the region and by the ongoing monetary stimulus announced by the ECB, Germany and the European Commission. 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 0.06% at 1.1224 and a breakout of 1.1348 (weekly high Jun.23) would target 1.1422 (weekly/monthly high Jun.10) en route to 1.1448 (50% Fibo of the 2017-2018 rally). On the downside, the next support lines up at 1.1168 (monthly low Jun.19) seconded by 1.1147 (high Mar.27) and finally 1.1031 (200-day SMA).