EUR/USD tests highs near 1.1560 ahead of data
- The pair trades in the 1.1550/60 band, or daily highs.
- The greenback stays rangebound below the 95.00 handle so far.
- EMU’s confidence/sentiment gauges next of relevance in the docket.
The sentiment around the shared currency remains depressed during the first half of the week, taking EUR/USD to the 1.1540/30 band, or multi-month lows, just to rebound afterwards.
EUR/USD looks to data, Italy
Increasing political jitters in Italy has been adding extra downside pressure to the pair, forcing it to fully retrace the November-February rally and return to levels near 1.1530, last traded in July 2017.
On the opposite side, the greenback is flirting with the 95.00 neighbourhood, or new multi-month peaks, always on the back of renewed sentiment and despite declining US yields. In fact, yields of the key US 10-year note has plummeted to the 2.75% region, where seem to have found some support now.
Back to Italy, latest news point to the likeliness of new elections at some point during July.
In the data space, German labour market figures and advanced CPI for the month of May are due next seconded by several gauges of confidence and sentiment in the euro area. Across the pond, another revision of Q1 GDP is due along with the ADP report for the month of May.
EUR/USD levels to watch
At the moment, the pair is up 0.13% at 1.1551 facing the next resistance at 1.1693 (10-day sma) seconded by 1.1718 (monthly low Dec.12 2017) and finally 1.1804 (21-day sma). On the flip side, a break below 1.1511 (2018 low May 29) would target 1.1479 (low Jul.20 2017) en route to1.1373 (low Jul.13 2017).