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EUR/USD keeps the positive tone near 1.1880 ahead of ECB

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FXStreet in Market News 12 128733
April 8, 2021 16:56

content provided with permission by FXStreet

  • EUR/USD flirts with the 200-day SMA around 1.1880.
  • The ECB will publish its Accounts of the March meeting.
  • Fed’s Powell, Initial Claims next of note in the US calendar.

The single currency regains the smile and motivates EUR/USD to stay close to the area of recent peaks in the vicinity of the 1.1900 neighbourhood.

EUR/USD looks to ECB, data, Powell

Following Wednesday’s move to fresh 2-week highs beyond 1.19 the figure, EUR/USD could not sustain the bullish impetus and closed the session slightly into the red territory.

However, the pair retakes the upper hand in the second half of the week and keeps gyrating around the critical 200-day SMA in the 1.1880 zone amidst the softer note in the buck and lower US yields.

Later in the euro docket, February’s Producer Prices are due seconded by the ECB’s Accounts of the March meeting.

Across the ocean, the usual weekly Claims will be in the limelight followed by the participation of Fed’s Powell on a discussion panel on “The Global Economy”.

What to look for around EUR

EUR/USD managed to finally surpass the 1.19 mark, although the move lost some vigour soon afterwards. The near-term outlook, however, looks improved and would not be surprising to see a sustainable advance further north of 1.1900 in the next sessions. The recovery in the pair emerged pari passu with fresh downbeat sentiment in the dollar and rising hopes of a sustained recovery in the Old Continent now that the vaccine rollout appears to have gained some pace.

Key events in the euro area this week: ECB Accounts (Thursday).

Eminent issues on the back boiler: Asymmetric economic recovery in the region. Sustainability of the pick-up in inflation figures. Progress of the vaccine rollout. Probable political effervescence around the EU Recovery Fund.

EUR/USD levels to watch

At the moment, the index is gaining 0.12% at 1.1876 and faces the next hurdle at 1.1914 (weekly high Apr.7) followed by 1.1989 (weekly high Mar.11) and finally 1.2000 (psychological level). On the downside, a breach of 1.1704 (2021 low Mar.31) would target 1.1602 (monthly low Nov.4) en route to 1.1570 (2008-2021 support line).