The common currency could receive the additional impetus and refresh long-term tops around 1.2200
The euro stays elevated these days, trading just below the April-2018 highs registered in the 1.2180 area earlier this month. The greenback stays on the defensive amid the persisting expectations for disbursement of a vaccine through 2021 and US stimulus hopes that help to partially offset concerns related to new lockdowns and the continued surge in COVID-19 cases in some parts of the world including the United States.
EURUSD is now holding firmly above the 1.2100 figure while the recent correction was capped by the 1.2060 area last week. The common currency could receive the additional impetus and refresh long-term tops around 1.2200 this week if the upcoming Federal Reserve meeting adds to the negative pressure surrounding the greenback. As a reminder, the two-day monetary policy meeting concludes on Wednesday and could set the tone for dollar pairs until the end of this week.
Elsewhere, the European Central Bank Governing Council member Olli Rehn said today that the central bank was monitoring the FX rate very closely. He also highlighted that the FX rate is not a policy target but has an impact. Despite the latest comments, the euro stayed in the green on the daily charts, signaling its readiness to extend the ascent.
On the hourly timeframes, the euro regained the 20-DMA while deriving support from the 100- and 200-SMAs since the start of the week. now, the pair needs to confirm a break above the 1.2150 area on a daily closing basis in order to see more gains in the days to come. On the downside, the immediate significant support is located around 1.2100, followed by the 1.2070 area.
In a wider picture, the pair remains within a strong uptrend as well, targeting the 1.2200 barrier. Once above this figure, EURUSD could climb to the 1.2230 region. However, the common currency may need the additional bullish driver to turn 1.2200 into support.