- The pair clinches fresh tops beyond 1.1800 the figure.
- The greenback quickly drops and retests the 93.80 area.
- ECB’s Draghi sees underlying inflation picking up vigorously.
EUR/USD leapt to fresh daily highs in the 1.1800/10 band in response to hawkish comments from President Mario Draghi.
EUR/USD regains 1.18 on Draghi
After bottoming out in the proximity of 1.1720 earlier in the session, spot gathered quick upside traction and moved beyond the 1.1800 milestone following comments by President Draghi.
In fact, at his speech before the European Parliament, Draghi noted the tight conditions in the labour market, upside pressure on wages while he sees a vigorous pick up in underlying inflation.
Draghi’s comments appear to have reinforced the idea that the ECB could start its tightening cycle at some point in H2 2019, with likely two rate hikes in October and December.
EUR/USD levels to watch
At the moment, the pair is up 0.49% at 1.1806 and a breakout of 1.1815 (high Sep.24) would target 1.1853 (monthly high Jun.14) en route to 1.1947 (200-day SMA). On the flip side, the next support aligns at 1.1684 (10-day SMA) followed by 1.1657 (21-day SMA) and then 1.1526 (low Sep. 10).
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