EUR/USD consolidates gains above 1.0970

The euro is rising sharply against the US dollar for the second trading day in a row. EUR/USD peaked at 1.0988 earlier today, hitting a 1-week high. Then it pulled back but remained above 1.0970. From Friday’s lows, it has risen more than a hundred pips. 

Again, EUR/USD is near the 1.1000 handle. Last Monday, it traded above, boosted after the French election but it failed to hold and corrected lower. 

The US dollar remains among the weakest currencies on Monday. Today’s US economic data included a negative surprise with the NY Empire state manufacturing index, falling to -1.0 in May against expectations of a 7.0 reading; then the NAHB Housing Market Index rose to 70, above the 68 of market consensus. 

US: The headline general business conditions index fell six points to -1.0 - NY Fed

Technical outlook

Currently, the pair trades at 1.0980, it remains near the highs, holding a bullish tone. From a technical point of view and in the short term, the 4 hours chart presents a bullish stance, as technical indicators enter overbought territory, whilst the price advances beyond a key Fibonacci support at 1.0930 and its 20 and 100 SMAs, both advancing around 1.0890/900”, said Valeria Bednarik, Chief Analyst at FXStreet. 

According to her EUR/USD has an immediate resistance just shy of 1.1000, followed by 1.1020. “Above this last, the upward momentum could extend up to 1.1060 on continued dollar weakness.”