EUR/USD headed to 1.2950 on weaker DXY, Sentix?

The ongoing recovery in EUR/USD gained extra legs in the European session, with the bulls now extending the break above 1.19 handle in a bid to regain 1.1950 barrier.

EUR/USD: Focus shifts to ECB decision                                     

The major recovers almost 70-pips from Friday’s ECB headlines induced drop to near 1.1850 levels, largely on the back of fresh selling seen in the US dollar versus its main peers, as disappointing US employment data raise concerns over Fed’s rate hike prospects.

Moreover, with the US markets closed on account of Labour Day, thin volumes and irregular volatility exaggerate the declines in the US dollar index, offering a helping hand to the EUR/USD recovery.

Furthermore, the Euro also found fresh impetus from upbeat Eurozone Sentix Investor Confidence data, which showed that Euro zone investor morale improved unexpectedly in September, arriving at 28.2 points from 27.7 points booked in August.

Next of relevance for the pair remains the US macro news and ECB policy announcement due on the cards later this week for fresh near-term trading opportunities.

EUR/USD Technical Set-up  

Valeria Bednarik, Chief Analyst at FXStreet, explains: “The 1.1920/30 region has proved strong these last few weeks, and is now the level to surpass to confirm additional advances today towards the 1.1960 region. Below 1.1870, the daily low and the immediate support, has its next support at 1.1822, last week low, although it seems unlikely the greenback can regain the upside today.”