EUR/USD poised to extend the rally towards the 1.20 figure

The EUR/USD pair has continued to advance on the back of dollar’s weakness, rallying ahead of Wall Street’s opening to fresh two-year highs above 1.1940. A test of 1.2000 is on the cards, according to FXStret’s Chief Analyst Valeria Bednarik reports.

Key quotes

“Speculative interest continues to sell the greenback, with the latest slump lacking a particular reason. In general, investors are dumping the US currency on concerns about economic growth and the absence of a new coronavirus stimulus package.”

“Building Permits in the US increased 18.8% in July, while Housing Starts were up by 22.6%. The figures, however, fell short of underpinning the American currency.”

“The 4-hour chart shows that EUR/USD has accelerated its advance beyond ascendant moving averages, with the 20 SMA currently at 1.1850. Technical indicators head firmly higher at fresh over one-week highs, and with the RSI already in overbought levels. Nevertheless, there are no signs of upward exhaustion, favoring a bullish continuation ahead towards 1.1995, a relevant weekly high from May 2018.”