EUR/USD stays close to lows around 1.1630, US GDP eyed

• Spot broke below key 1.1660 support area (neckline).
• Dovish ECB keep weighing on sentiment.
• DXY advanced to 3-month tops.
• Further decline likely following the ‘outside day’ candle.

The European currency keeps suffering the dovish message from the ECB and is now forcing EUR/USD to navigate the lower end of the range in the 1.1630 area.

EUR/USD now looks to US data

The pair is trading in levels last seen in July around 1.1630 after breaking below the technical 1.1660 area, consistent of August’s lows and the ‘neckline’ from the H&S pattern prevailing since late July.

The dovish tone from President Draghi at the ECB meeting on Thursday coupled with renewed and strong sentiment towards the greenback were far too much for the pair, which already shed around 2 cents since yesterday’s tops near 1.1840 (55-day sma).

Fanning the flames around EUR, the situation in Catalonia keeps worsening after Catalan leader C.Puigdemont refused on Thursday to call for snap elections in the region, paving the way for the Spanish government to trigger direct rule.

Absent important data releases in Euroland today, the focus of attention will shift to advanced US GDP figures for the third quarter and the final gauge of the consumer sentiment for the month of October.

EUR/USD levels to watch

At the moment, the pair is losing 0.08% at 1.1643 and a break below 1.1625 (low Oct.27) would open the door to 1.1585 (high Jul.18) and finally 1.1491 (high Jul.12). On the flip side, the next up barrier aligns at 1.1679 (100-day sma) seconded by 1.1759 (10-day sma) and then 1.1837 (high Oct.26).