- EUR / USD extends the bullish run and hits 1.1880, the highest since Thursday.
- Eurozone Sentix Confidence Index below July estimates.
- Ahead: speech by Christine Lagarde of the ECB.
The weakness of the dollar against the main European currencies is still standing and pushed the EUR / USD to rise to 1.1880, the highest level since last Thursday. The price remains bullish and close to the highs.
EUR / USD rises on dollar weakness and looks at Lagarde
The EUR / USD advances for second consecutive session and extends bounce from three-month lows, recorded on Friday near the 1.1800 meters.
The selling pressure continues to hurt the dollar as investors continue to evaluate the latest non-farm payroll figures (+850,000). Volume on Monday remains limited as it is a US holiday for Independence Day.
Regarding the data in the Eurozone, the Final PMI for services in Germany stood at 57.5 for the month of June (from 58.1 preliminary) and at 58.3 in the Eurozone (58.0 preliminary). In another report, it was learned that the sentix confidence index improved to 29.8 in July, from 28.1.
Later in the session, the president of the European Central Bank, Chirstine Lagarde will participate in a round table in France.
What to look for around EUR
Sellers failed to drag EUR / USD lower than 1.1800 last week. Meanwhile, price action around the ground is expected to exclusively follow dollar dynamics, particularly after the last FOMC meeting supported prospects for higher inflation and possible reductions in the buying program. Support for the European currency is driven by auspicious data, a strong rebound in economic activity and investor appetite for riskier assets.
Key events in the Eurzone this week: Lagarde (Monday) from the ECB – ZEW Germany / Eurozone Survey (Tuesday) – Accounts from the ECB (Thursday) – Lagarde from the ECB (Friday).
Issues to consider: Asymmetric economic recovery in the region. Sustainability of the rebound in inflation figures. Progress of the implementation of vaccination. Likely political turmoil around the European Union Recovery Fund. Elections in Germany.
EUR / USD levels
So far, EUR / USD is gaining 0.12% near 1.1880 and is facing the next hurdle at 1.1900, followed by 1.1975 (June 25 weekly high) and 1.1997 (200-day moving average). On the bearish side, the first support appears at 1.1850 (daily low), followed by 1.1822 (July low) and 1.1762 (Fibonacci retracement of 78.6% from the November to January rally).
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