EUR/USD apathetic near 1.1430 post-US data, now looks to Draghi
- The pair remains depressed in the area of weekly lows near 1.1430.
- US headline Producer Prices dropped 0.2% MoM in December.
- ECB’s Draghi speaks before the European Parliament later.
The softer tone around the European currency remains well in place today, keeping EUR/USD under pressure in the 1.1430/20 band.
EUR/USD attention shifts to Draghi, Brexit
Spot has reverted yesterday’s pullback and is so far charting a bearish ‘outside day’, all amidst the broader correction lower after being rejected from last week’s peaks in the 1.1580/85 band.
On another side, the pair paid little attention to the release of US data, where Producer Prices surprised to the upside in December and the NY Empire State index dropped to 3.9 for the current month, well below expectations.
Moving forward, President M.Draghi is due to speak before the European Parliament. Investors, in the meantime, would look for any mention or signs of wariness in response to the ongoing slowdown in the bloc.
What to look for around EUR/USD
All the looks will be upon the Brexit vote later today and its impact on the broad risk appetite trends. Previously, investors would closely follow Draghi’s speech for any clues on the apparent slowdown in some fundamentals in the region and the implications (if any) on the bank’s monetary stance. In the medium/longer term, US-China trade dispute should remain a key driver for the sentiment in the global markets. Further out, Italian politics, the French budget, EU Parliamentary elections and the evident slowdown in German fundamentals in H2 2018 could undermine further bullish attempts in EUR.
EUR/USD levels to watch
At the moment, the pair is retreating 0.25% at 1.1438 facing immediate contention at 1.1412 (low Jan.15) seconded by 1.1380 (55-day SMA) and then 1.1356 (23.6% Fibo of the September-November drop). On the upside, a break above 1.1569 (2019 high Jan.10) would open the door to 1.1585 (61.8% Fibo of the September-November drop) and finally 1.1621 (high Oct.16 2018).