EUR/USD to accelerate the leg higher on a break of 1.1770

The shared currency is up despite some weak macroeconomic figures released earlier in the day. Bulls are set to challenge a critical Fibonacci resistance at 1.1770, Valeria Bednarik, FXStreet’s Chief Analyst, reports.

See – EUR/USD: Positioning is the biggest near-term headwind – Credit Suisse

Key quotes

“Headlines related to a US coronavirus aid package and Brexit have shaken the FX board, although, at the time being, the market’s mood is upbeat, amid hopes both conflicts will reach safe ports. As long as risk-on prevails, the greenback will remain under selling pressure.”

“The EU unemployment rate resulted at 8.1% in August as expected, rising for a fifth consecutive month.  Also, the final versions of Markit PMIs for the Union suffered revisions, with the German index down to 56.4 from 56.6 previously estimated. The index for the EU remained unchanged at 53.7.”

“The risk is skewed to the upside, according to technical readings in the 4-hour chart, but still needs to accelerate above the 1.1770 daily high to confirm a new leg north. In the mentioned time-frame, the 20 SMA maintains its bullish slope below the current level, while the 100 SMA heads lower around the mentioned daily high. Technical indicators, in the meantime, have turned higher, but the momentum remains limited.”