EUR/USD Advances to 1.1340 Amid BOJ-Led USD Sell-Off

EUR/USD Advances to 1.1340 Amid BOJ-Led USD Sell-Off

28 April 2016, 07:49
Roberto Jacobs

EUR/USD Advances to 1.1340 Amid BOJ-Led USD Sell-Off

EUR/USD remains better bid on 1.13 handle as we progress towards the early European trades, with markets still digesting the Fed and BOJ policy decisions.

EUR/USD finds fresh bids just shy of 1.1300

Currently, EUR/USD trades +0.13% higher at 1.1338, hovering within a striking distance of session highs printed at 1.1343 in the last hour. The main currency pair manages to hold the upside and now extends gains beyond 1.13 handle on the back of renewed USD selling across the board, triggered by BOJ-led sell-off in the USD/JPY pair.

The BOJ kept policy steady at its policy review meeting today, largely disappointing markets, who had bet for more easing this Thursday. USD/JPY slumped over 2%, dragging the greenback lower against its major peers. At the timing of writing, the USD index drops -0.36% to 94.05 levels.

Meanwhile, the major finds support near 1.13 handle and keeps the upside bias intact against a backdrop of the latest dovish FOMC statement, which failed to provide clear hints on the next Fed rate hike this year. With the central banks’ events now behind, focus once again turns to fundamentals from both continents. The German prelim CPI, employment data as well as the US advance GDP report will be closely eyed in the day ahead.

EUR/USD Technical Levels

In terms of technicals, the pair finds the immediate resistance at 1.1361/67 (Apr 27 High/ Daily R1). A break beyond the last, doors will open for a test of 1.1396/1.1400 (Apr 21 High/ round number). On the flip side, the immediate support is placed at 1.1281/73 (1h 100-SMA/ post-FOMC lows) below which at 1.1232/19 (Apr 14 & 25 Low) could be tested.


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