EUR/USD fades the spike to 1.0820, back to 1.0780

After climbing as high as the 1.0820 region, EUR/USD’s bullish attempt lost momentum and has now receded to the 1.0780/75 band.

EUR/USD trims gains post-ZEW

The pair has managed to clinch fresh daily highs above 1.0800 the figure on Tuesday, although the bull run lacked of follow through around 1.0820, prompting the current knee-jerk.

The initial softer tone around the greenback has allowed spot to rebound from yesterday’s fresh 2016 lows near the 1.0700 handle. However, EUR still remains under pressure as the weakness in the buck is seen as temporary only.

Data wise in Euroland, German ZEW for the current month showed mixed results in Germany, with Current Conditions coming in below estimates while Economic Sentiment bettered expectations at 13.8. EMU’s Economic Sentiment has also surprised to the upside.

Further data showed EMU’s advanced GDP figures pointing to an annualized expansion of 1.6% and 0.3% inter-quarter, both prints falling in line with consensus.

Still in the data space, US October’s Retail Sales are due followed by the NY Empire State Manufacturing index. In addition, Boston Fed E.Rosengren (voter, dovish) and FOMC’s Vice Chairman S.Fischer (permanent voter, hawkish) are due to speak.

According to the latest CFTC report, EUR speculative net short have decreased by around 8K contracts during the week ended on November 8, while Open Interest dropped by around 26K contracts.

EUR/USD levels to watch

The pair is now advancing 0.36% at 1.0776 facing the next hurdle at 1.0817 (high Nov.17) followed by 1.0848 (low Oct.25) and finally 1.0941 (20-day sma). On the other hand, a breakdown of 1.0706 (2016 low Nov.14) would target 1.0538 (low Dec.3 2015) en route to 1.0519 (low Apr.13 2015).

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