- EUR / USD pushes higher to the 1.2140 region on Friday.
- The ECB did not discuss the possible reduction, Accounts said.
- US retail sales were unchanged monthly in April.
The bulls remain in control of sentiment around the single currency, with the EUR/USD now sailing in the area of daily highs near 1.2140.
EUR / USD stronger due to dollar sell off
EUR / USD is advancing for the second day in a row and is looking to consolidate the recent breakout of the key 1.2100 barrier.
In fact, the growing selling pressure around the dollar continues to fuel the renewed rise in the pair. In fact, poor retail sales impressions for April added to the current negative mood in the dollar, also exacerbated by falling US yields.
In the ECB space, the accounts of the last meeting indicated that the Governing Council did not discuss any reduction in the bond purchase program. However, a positive assessment came after members acknowledged that risks to the activity are now skewed slightly to the upside. The latter could carry forward the discussion on fine-tuning, with the September event being a likely candidate. Further, the Accounts continue to experience an asymmetric recovery in the region, and the countries most dependent on services are expected to recover at a slower pace.
Other data on the US agenda saw industrial production expanding 0.7% monthly in April and capacity utilization rising to 74.9%.
The US consumer sentiment index fell to 82.8 (preliminary) in May from 88.3 in April, the latest consumer survey from the University of Michigan showed on Friday. This reading disappointed the market’s expectation of 90.4 by a wide margin.
Further details from the release revealed that the Current Economic Conditions Index dropped to 90.8 from 97.2 and the Consumer Expectations Index dropped to 77.6 from 82.7. Finally, the 1-year inflation outlook jumped to 4.6% from 3.4%.
What to look for around EUR
EUR / USD regains ground lost in past sessions and advances past 1.2100 amid better tone in riskier assets. Meanwhile, sentiment around the single currency remains constructive as investors shift towards improved growth prospects in the Old Continent, now that the vaccine campaign appears to have gained serious pace and solid results from fundamentals. key with rising morale on the block.
Technical levels
So far, the pair is gaining 0.48% at 1.2135 and is facing the next ascending barrier at 1.2181 (May 11 monthly high) followed by 1.2243 (February 25 monthly high) and finally 1.2349 (February 6 high). January 2021). On the downside, a break below 1985 (May 5 monthly low) would target 1.1951 (200-day SMA) en route to 1.1887 (61.8% Fibonacci from November-January rally).
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