- EUR / USD gained traction in the second half of the day.
- The US Dollar Index is pushing lower towards 89.50.
- Improving market sentiment appears to be weighing on the dollar.
The pair EUR/USD it spent the first half of the day in a relatively tight range near 1.2770, but began to rise during the US session with the dollar under renewed selling pressure. At time of writing, the pair was up 0.37% on the day at 1.2295.
USD selloff gains momentum
Earlier in the day, the cautious mood of the market allowed the USD to remain resilient against its peers. However, the release of optimistic macroeconomic data from the United States and the prospects of a Democratic majority in the Senate after the second round of elections in Georgia gave a boost to market sentiment.
Reflecting the positive mood, the major Wall Street indices were up around 0.3% on the day and the US Dollar Index is losing 0.38% to 89.53.
Data released by the ISM on Tuesday showed that the December manufacturing PMI rose to its highest level since August 2018 at 60.7 to show that business activity expanded at an impressive rate in late 2020.
On Wednesday, IHS Markit will release services PMI data for Germany, the euro area and later the US ADP’s job change will also be on the US economic agenda. Investors will be watching the results of the Georgia elections, which will be announced Wednesday morning.
Technical levels
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