EUR/USD firmer, eyes on 2017 tops above 1.10

The weakness around the greenback continues to give oxygen to EUR/USD during the first half of the week, now gearing up for another visit to the psychological 1.1000 handle and a potential test of the 1.1020 area, YTD peaks.

EUR/USD focus on data

Spot is advancing for the third session in a row, as the offered bias stays unabated around the US Dollar. In fact, USD continues to lose ground on the back of recent disappointing key data in the US docket and a strong rebound in the risk-associated universe.

However, expectations of a rate hike by the Federal Reserve at the June meeting stay firm and could limit the dollar’s decline somewhat. Furthermore, the probability of higher rates next month is at almost 74% according to CME Group’s FedWatch tool. Still quite high although down from Friday’s 83%.

In the data space, German ZEW survey is expected to surprise to the upside for the current month, while the economy of the region is seen expanding 0.5% QoQ during the March-January period.

Across the pond, Housing Starts, Building Permits, Industrial and Manufacturing Production are all due later in the NA session.

EUR/USD levels to watch

At the moment, the pair is advancing 0.16% at 1.0993 and a break above 1.1024 (2017 high May 8) would expose 1.1073 (76.4% Fibo of the 1.1300-1.0339 drop) and finally 1.1300 (high Nov.9 2016). On the flip side, the next support aligns at 1.0916 (23.6% Fibo of the April-May rally) followed by 1.0887 (20-day sma) and finally 1.0838 (low May 11).