EUR/USD sticks to gains above 1.1800, despite Catalan headlines

The EUR/USD pair caught a fresh bid-wave and jumped to fresh daily tops of 1.1822, after the Calatan leader Puigdemont’s comments, only to fade the renewed uptick last minutes in a bid to retest 1.1800 levels.

EUR/USD still above 5-DMA at 1.1796

The spot is seen consolidating the renewed upside, although manages to hold the 1.18 handle, as markets assess the implications of Catalonia’s President Puigdemont’s independence declaration for Spain and EU as a whole. Markets are now speculating that Spain PM Rajoy may call cabinet meeting on Saturday, to discuss the triggering of the Article 50, which could keep a check on further gains.

However, the downside remains limited amid fresh broad based USD selling, as the European traders react to the lack lustre US data released a day before. Meanwhile, negative sentiment on the European equities amid disappointing earnings, also offers some support to the funding currency Euro.

Later today, the pair will get influenced by the sentiment around the European markets and Catalan political updates, as traders gear up for the US jobless claims and Philly Fed manufacturing index data.

EUR/USD Technical View

According to Jim Langlands at FX Charts: “The dailies are now pretty flat so some caution is warranted on the downside and the 4 hour charts do point a little higher but as long as we stay under 1.1880 I am happy to be short, with the need to keep a tight SL in place above 1.1900. The H/S objective is at around 1.1250.”