The EUR/USD pair’s attempt to renew its five-month high during the European session fell a few pips short, and the pair started to trim its gains in the first half of the NA session after some positive macroeconomic data from the United States. Despite its pullback, EUR/USD is headed for weekly gains and is now trading at 1.0895, up 0.18% on the day.
The pair had a strong start to the week as the investors cheered the result of the first round of French presidential election. EUR/USD was able to add to its gains on Tuesday before making a technical correction on Wednesday.
The ECB decision and President Draghi’s comments on the monetary policy on Thursday triggered a euro sell-off as the expectations for a QE tapering weakened after Draghi mentioned that the Governing Council hadn’t discussed a QE exit strategy. However, despite Thursday’s downfall, the pair is about to close the week with a gain of 170 pips.
On the other hand, the US Dollar struggled all week long as it failed to make a daily close above 99 after having opened the week with a negative gap. In fact, the index is about to close the week 1 point lower than last week’s closing level (99.88).
The pair could encounter the first support at 1.0850 (Thursday low) followed by 1.0780 (200-DMA) and 1.0740 (Mar. 29 low). To the upside, a break above 1.0950 (Apr. 27 high) could aim for 1.10 (psychological level) and 1.1070 (Nov. 8 high).