EUR/USD finds support near 1.1870

The single currency stays directionless on Tuesday, with EUR/USD navigating the area near 1.1900 the figure following the opening bell in Wall St.

EUR/USD cautious ahead of the ECB

After bottoming out in the 1.1870 region, spot managed to regain some attention and has now returned to the 1.1900 neighbourhood, although it keeps the narrow range amidst prevailing risk aversion and a softer tone surrounding the buck.

On the USD-side, the US Dollar Index (DXY) remains depressed around the mid-92.00s in response to a poor performance of yields in the US money markets, where the 10-year benchmark has tumbled to the 2.11% handle at the time of writing.

In the data space, EMU’s services PMI dropped to 54.7 in August while retail sales in the bloc contracted 0.3% on a monthly basis in July.

In the US, factory orders contracted at a monthly 3.3%, missing initial forecasts. Later in the session, Dallas Fed R.Kaplan (voter, hawkish) and Minneapolis Fed N.Kashkari (voter, dovish) are due to speak. Earlier in the day, FOMC’s L.Brainard (permanent voter, dovish) advocated for a more gradual tightening by the Fed.

EUR/USD levels to watch

At the moment, the pair is gaining 0.02% at 1.1898 and a break above 1.1911 (high Sep.5) would open the door to 1.1981 (high Sep.1) and finally 1.2069 (2017 high Aug.29). On the downside, the immediate support lines up around 1.1828 (21-day sma) seconded by 1.1823 (low Aug.31) and then 1.1737 (5-month support line).