EUR/USD retreats from tops, around 1.1980

The single currency is now giving away part of its initial gains, motivating EUR/USD to abandon the area of daily highs and return to the 1.1980/75 band ahead of the opening bell in Europe.

EUR/USD looks to data, USTs

Spot briefly surpassed the 1.1990 level during early trade, although sellers now seem to be clustered in the 1.2000 neighbourhood, capping initial bullish attempts.

In addition, yields in the US money markets eased some ground and lent extra legs to the pair at the same time. In fact, yields of the key 10-year benchmark dropped to the 2.15% area after testing the vicinity of 2.18%, weighing as well on the sentiment surrounding the greenback.

All in all, the ‘buy the dips’ stance seems to remain well and sound among investors and keeps underpinning spot for the time being. US yields stay so far as the key drivers for the pair’s price action, somewhat relegating chatter about the potential ‘tapering’ by the EC in the next months.

Data wise today, EMU’s industrial production during July is due, while producer prices and the usual EIA report are expected across the Atlantic.

EUR/USD levels to watch

At the moment, the pair is gaining 0.11% at 1.1979 and a break above 1.2041 (high Sep.11) would target 1.2092 (2017 high Sep.6) en route to 1.2167 (50% Fibo of the 2014-2017 drop). On the downside, the immediate support lines up around 1.1946 (10-day sma) seconded by 1.1888 (21-day sma) and then 1.1823 (low Aug.31).