EUR/USD off-highs, supported at 20-DMA ahead of ECB

EUR/USD extends its post-ISM services PMI upside consolidation phase for the second straight session this Thursday, as traders remain on the back foot ahead of the much-awaited ECB monetary policy decision.

EUR/USD: 1.12 or 1.13 on ECB?

Currently, EUR/USD trades +0.08% at 1.1248, retreating from session highs reached at 1.1258 last hours. The main currency pair is seen trading quite choppy so far this session, although managed to hold gains above 20-DMA now located at 1.1235.  

The extension of the side-trend in the major is mainly driven by increased nervousness ahead of the ECB decision, as markets refrain from placing any directional bet on the euro in anticipation of fresh hints on the central bank’s asset purchase program.

Moreover, ECB Chief Draghi’s comments on the Euro area economies will be closely eyed, particularly Spain and Italy, besides his take on the growth and inflation outlook.

EUR/USD Technical Levels               

In terms of technicals, the pair finds the immediate resistance 1.1300 (round number). A break beyond the last, doors will open for a test of 1.1343 (Aug 28 high). On the flip side, the immediate support is placed at 1.1235/26 (20-DMA/ Sept 7 low) below which 1.1209 (5-DMA) could be tested.