EURUSD is back beyond the 1.0900 figure, holding well above the 20-DMA
The euro keeps trending higher since Monday, recovering after Friday’s slide, with the overall bullish trend persisting as the US dollar remains weak. The USD index struggles for direction these days after a bounce from fresh multi-month lows registered last week below the 102.00 figure. The greenback has settled around 102.50, with the immediate barrier arriving at 102.65.
Should risk demand continue to wane in the near term, the safe-haven US currency may challenge this hurdle, with the key resistance coming at 103.00. On the downside, the nearest support now arrives at 102.40, followed by the 102.00 figure and the 101.75 zone that capped losses last week.
As such, EURUSD is back beyond the 1.0900 figure, holding well above the 20-DMA that arrives around 1.0875. The shared currency remains upbeat even as the ECB Governing Council member Villeroy said earlier in the day that they will not raise interest anymore. Now, traders shift their focus towards the inflation data from the Eurozone which is expected to remain unchanged across all levels.
Meanwhile, the technical indicators for the pair suggest a favorable upward trend. Should the greenback remain indecisive in the near term, the euro may retest the psychological resistance at the 1.1000 level that capped gains last week. On the flip side, the psychological support at 1.0900 emerges as a crucial level, followed by the 1.0885 zone.
In a wider picture, this month’s gains look modest as compared to the November’s rally, suggesting the bullish momentum has been waning gradually. On the other hand, the dollar would stay pressured by growing Fed rate cut expectations, which implies that downside risks surrounding the common currency would stay limited in the near- to medium term.
