EUR/USD: Fresh bids emerge ahead of 1.1150

The ongoing recovery in EUR/USD from three-week lows of 1.1119 lost legs at 1.1180 levels, knocking-off the rate to test the mid-point of 1.11 handle. However, fresh buyers emerged near the last, allowing a minor-bounce in the spot back to the 5-DMA support-turned resistance located at 1.1163.

EUR/USD: EZ consumer confidence eyed

The main currency pair is seen making minor-recovery attempts over the last hour, as the renewed buying interest seen behind the USD versus its main competitors appears to have fizzled out, in the wake of persistent weakness in Treasury yields across the curve.

The shorter duration Treasury yields face fresh selling pressure as markets doubt the chances of future rate hikes. Sliding oil prices weigh negatively on the US inflation expectations, dampening the Fed’s rate hike outlook and therefore, exerts downward pressure on the US yields.

However, the recovery in EUR/USD appears to lack follow-through, with investors seeking to remain in a wait-and-see mode ahead of the EU leaders meeting in Brussels later today. Also, amid a lack of catalysts in the EU session, focus remains on the Eurozone consumer confidence and US jobless claims for fresh trading impetus. More so, Fedspeaks will also have a major impact on the greenback.

In the meantime, markets digest the latest economic bulletin published by the ECB, which revealed that ongoing economic expansion in Euro Area remains increasingly resilient.

EUR/USD Technical Levels

Jim Langlands at FX Charts explains: “With the short term momentum indicators now looking a little more constructive we could see a near term squeeze to the topside and above the session high would open the way back towards 1.1185 and the 19 June high of 1.1212. The immediate support now arrives at 1.1125 beyond which would allow a move to 1.1100/10 and possibly to 1.1065/75 and 1.1015 although possibly not yet.”