EUR/USD Fades a Spike to 1.1465, Back to Square One
The EUR/USD pair trims gains and now slips back below the mid-point of 1.14 handle, having failed to sustain at fresh 2016 highs.
EUR/USD hits fresh 2016 highs, then retreats
Currently, EUR/USD trades 0.16% higher at 1.1425, having met strong selling pressure at 1.1465, fresh six-month highs. The main currency pair’s bullish run lost legs over the last hours and the prices retraced half the intraday gains, as the US dollar halted its downwards spiral and recovered losses against a basket of six major currencies. The USD index now loses -0.17% to 93.80, versus a -0.35% drop seen earlier on the day.
The renewed selling pressure seen on the major can be also justified by a sharp decline in the EUR/GBP cross as the pound strengthened against the shared currency after the UK CPI data outpaced estimates and hit fresh sixteen-month highs in March.
However, the sentiment remains underpinned as the EUR traders continue to cheer upbeat German CPI and PPI data released earlier today. Germany’s CPI grew 0.8% m/m in March, faster than February's figure of 0.4% and in line with the estimates.
Attention now remains on the US import prices data in absence of relevant economic news from the US docket today, while the Chinese trade numbers due tomorrow will be closely monitored for its impact on the broader market sentiment.
EUR/USD Technical Levels
In terms of technicals, the pair finds the immediate resistance at 1.1465/87 (Daily & 2016 high/ Daily R2). A break beyond the last, doors will open for a test of 1.1500 (psychological levels). On the flip side, the immediate support is placed at 1.1387/72 (1h 200-SMA/ daily S1) below which at 1.1316/1.1300 (20-DMA/ key support) could be tested.
(Market News Provided by FXstreet)