EUR/USD testing lows near 1.0520 ahead of IFO

The demand for the single currency remains subdued on Thursday, with EUR/USD challenging daily lows in the 1.0530/25 band.

EUR/USD attention to IFO, USD

The pair stays under heavy pressure and vulnerable to extra downside as the greenback not only remains firm, but it keeps pushing higher in terms of the US Dollar Index, which clinched fresh 13-year tops near the 102.00 handle in early trade.

In the meantime, spot is on its way to close its third week with losses, so far including a new YTD low and with the likeliness of deeper pullbacks in the near to medium term.

USD appears well supported by expectations of a rate hike by the Federal Reserve at its meeting next month – already priced in by market participants – particularly after yesterday’s FOMC minutes, which have once again reiterated the solid performance of the labour market.

Later in the session, November’s IFO Survey in Germany is expected to come in in line with the previous month’s readings, whereas markets across the pond will be closed due to the Thanksgiving Day holiday.

EUR/USD levels to watch

The pair is now losing 0.27% at 1.0524 and a break below 1.0519 (low Apr.13 2015) would open the door for 1.0457 (2015 low Mar.16) and then 1.0332 (monthly low January 2003). On the other hand, the initial resistance aligns at 1.0660 (high Nov.22) followed by 1.0763 (high Nov.16) and finally 1.0826 (high Nov.14).