- EUR / USD extends the bullish move and is approaching the 1.1900 level.
- The dollar remains on the defensive and supports the rise in the pair.
- The CPI of the euro zone rises 0.2% in its monthly reading for October.
The buying bias around the common currency remains strong and pushes EUR / USD to weekly high zone near 1.19 level.
EUR / USD focuses attention on risk trends and data
The EUR / USD posts earnings for the fifth day in a row on Wednesday, although a test or break of the key 1.1900 zone remains elusive for the pair’s bulls.
Meanwhile, the pandemic continues its relentless advance around the world. while countries continue to implement new and stricter restrictions that directly impact the prospects for global growth.
In front of this and together with the imminence of an effective vaccine, investors continue to support the vision of a strong recovery and therefore benefit risk appetite sentiment, weighing on safe-haven USD.
Regarding the eurozone data, The CPI consumer price index of the euro zone has risen 0.2% in its monthly reading October, improving by one tenth the previous and expected 0.1%. This is the biggest rise seen by the indicator since last June. Annual inflation has shown a fall of 0.3%, matching the forecasts and the result of the previous month.
Across the Atlantic, the spotlight will turn to housing sector data, with the release of building permits and housing starts, along with several scheduled speeches from Fed members.
What can we expect around the EUR?
EUR / USD is once again looking to retest the key barrier near the 1.1900 level amid favorable risk appetite trends. However, in the very near term, the EUR / USD pair is expected to remain under pressure from the dynamics of the dollar coming mainly from the post-election scenario in the US and the progress of the coronavirus pandemic. On the more domestic front, the euro seems supported by upbeat results from the region’s fundamentals (despite the fact that momentum seems somewhat mitigated in several regions), although the now more pessimistic stance of the ECB suggests some caution in the bullish attempts of the pair. As usual, the euro still appears underpinned by the strong current account position of the eurozone.
EUR / USD levels
At the time of writing, the EUR / USD pair is gaining 0.17% on the day, trading at 1.1881. A break above 1.1920 (November 9 high) would target 1.1965 (August 18 high) on the way to 1.2011 (September 1 high). On the other hand, the next support is at 1.1745 (November 11 low), followed by 1.1709 (Fibonacci level of the 2017-2018 movement) and finally 1.1602 (November 4 low).
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