- EUR / USD is trading at new 2-week highs near 1.1840.
- The dollar falls in response to falling yields in the United States.
- The EMU unemployment rate was unchanged at 8.3% in February.
Buying interest around the European currency remains good and solid in the first half of the week and is now rising to EUR/USD to new 2-week highs at 1.1830 / 35.
EUR / USD on multi-day highs
EUR / USD adds to Monday’s optimism and seeks to consolidate the recent breakout of the key barrier at 1.18.
The pair’s continued rally comes amid the downward correction in US yields, which in turn has been transformed into increased selling pressure around the dollar. In fact, 10-year US bond yields are above the 1.70% level and are challenging the daily lows zone.
The results in the euro zone showed that the Investor Confidence measured by the Sentix index improved to 13.1 for the month of April, while the Unemployment Rate reached 8.3% in February, not meeting the forecasts.
Data from across the pond includes the IBD / TIPP index, JOLT job postings, and the API’s weekly crude oil supplies report.
What to look for around EUR
EUR / USD found decent resistance around 1.1820 in the first half of the week. The sharp pullback in the pair seen lately came along with the persistent supply bias in the dollar, which has been undermining the pair’s constructive outlook in recent weeks. The deterioration of morale in the euro zone, coupled with the poor pace of the vaccine launch in the region versus the strong performance of the US economy, have been contributing to the renewed stance on the single currency. However, the firm hand of the ECB (despite some verbal concerns) in combination with the expected rebound in economic activity in the region in the post-pandemic stage will likely prevent a much deeper pullback in the long-term pair.
Technical levels
At the moment, the index is gaining 0.23% at 1.1838 and faces the next hurdle at 1.1875 (200-day SMA) followed by 1.1989 (March 11 weekly high) and finally 1.2000 (psychological level). On the downside, a breakout of 1.1704 (March 31 low) would target 1.1602 (November 4 monthly low) en route to 1.1573 (2008-2021 support line).
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