EUR/USD sits at monthly highs near 1.2180 amid US dollar weakness
- EUR/USD eyes 1.2200 amid broad US dollar weakness.
- Further upside appears elusive amid rising Treasury yields.
- Focus shifts to the US durable goods data and Prelim GDP.
EUR/USD flirts with daily highs near 1.2180 heading into the European open, as the bulls aim for the 1.2200 level amid notable US dollar supply across the board.
The main currency pair found buyers near the 1.2160 region during mid-Asia and since then it has resumed its journey northwards.
The US dollar continues to remain broadly weaker, as the stimulus and vaccine-optimism-driven expectations of a quick global economic recovery continue to spur reflation trade, benefiting the riskier assets at the safe-haven dollar’s expense.
The US dollar index drops 0.22% so far, having lost the 90 handle once again while EUR/USD trades at 1.2176, as of writing.
However, the EUR bulls are struggling to extend their control, as reflation-rally in the US Treasury yields continue to undermine the sentiment around the major. The benchmark 10-year US Treasury yields rise nearly 1% to now trade just above 1.40%.
Meanwhile, the EUR markets ignored the dovish comments from the European Central Bank (ECB) policymaker Isabel Schnabel. Schnabel said that the fiscal and monetary policy must not be withdrawn prematurely.
Next of relevance for the pair remains the Eurozone consumer and business sentiment numbers ahead of the speech by ECB’s Phillip Lane. In the NA session, a bunch of critical US data will hog the limelight amid fresh vaccine and stimulus updates.
EUR/USD: Technical outlook
“A clear break above the immediate resistance line around 1.2175 will not give a green pass to the EUR/USD bulls as multiple stops to the north marked in January close to 1.2200 will challenge the upside. thee support line of the stated chart pattern near 1.2070 becomes the key,” FXStreet’s Analyst Anil Panchal notes.
EUR/USD additional levels