Euro keeps bullish stance for renewed attack at pivotal 1.10 zone
EURUSD keeps firm tone on Monday and resumed higher after brief consolidation, focusing psychological 1.10 barrier and June 22 peak (1.1012).
The Euro surged on Friday, following weaker than expected US non-farm payrolls, which deflated dollar, while downbeat China inflation data, released overnight, produced a minor negative impact to the single currency.
Overall sentiment is positive for Euro, as traders focus on US June inflation report (due on Wednesday) which may further cool demand for the dollar if CPI meets expectations (June y/y 3.1% f/c vs May 4.0%), as steady inflation easing would signal less need for further policy tightening by the Fed, after July meeting.
Technical picture on daily chart remains bullish, as positive momentum is strengthening, MA’s are in bullish setup and the action is underpinned by thick daily cloud, although overbought stochastic warns of increased headwinds on approach to key barriers at 1.1000/12.
Near-term action needs to hold above broken Fibo barrier at 1.0944 (61.8% of 1.1012/1.0833) to keep bulls intact for renewed attack at 1.10 zone, violation of which would open way towards 20213 high at 1.1095 (Apr 26).
Res: 1.0980; 1.1000; 1.1012; 1.1054
Sup: 1.0944; 1.0923; 1.0904; 1.0865