EUR/USD off-lows, re-takes 1.1950 on CPI

The minor pullback seen in EUR/USD from 1.1915 levels appears to have gained fresh legs on the release of Eurozone CPI figures and Italian trade report.

EUR/USD finds support once again near 5-DMA at 1.1922    

A positive surprise seen in the Eurozone core CPI figures lent extra support to the latest leg up in EUR/USD, as the bulls look to reclaim 1.1950 levels on their way to 1.20 handle. European Monetary Union Consumer Price Index - Core (YoY) registered at 1.3% above expectations (1.2%) in August

Moreover, solid Italian trade numbers combined with the latest remarks from the ECB policymaker Hansson also aid the recovery in the major. ECB’s Hansson commented on the central bank’s next policy move, citing recalibration of the stimulus alongside a change in the QE programme.

However, it remains to be seen if the spot can take on the recovery above 1.1950 levels, as the US dollar makes another recovery attempt against its main competitors, after Friday’s downbeat retail sales induced sell-off.

Focus now shifts towards the German Buba monthly economic report and US NAHB housing market index for fresh impetus on the prices.

EUR/USD Technical Set-up  

Mohammed Isah at FXTechstrategy noted: “With the pair still holds on to its broader uptrend despite lower close the past week. Resistance comes in at 1.2000 level with a cut through here opening the door for more upside towards the 1.2050 level. Further up, resistance lies at the 1.2100 level where a break will expose the 1.2150 level.”

Conversely, support lies at the 1.1800 level where a violation will aim at the 1.1750 level. A break of here will aim at the 1.1700 level. Below here will open the door for more weakness towards the 1.1650,” Mohammed added.