EUR/USD on the offers, but keeps 1.1400 ahead of NFP

The EUR/USD pair extends its upside consolidation phase into Europe, having found some buyers just ahead of 1.14 handle during the Asian session.

EUR/USD: 1.1450 back on sight

Having failed several attempts to take-out three-day tops of 1.1425 in Asia, the main currency pair drifted slightly lower and turned negative amid broad based US dollar recovery.

Markets seek to take profits off the table on their USD shorts after yesterday’s extensive slide, triggered by downbeat ADP jobs data and dinging US-German yields differentials on narrowing monetary policy divergence between the Fed and ECB.

The German yields rallied hard alongside the Euro, hitting fresh 18-month tops of 0.574 after the ECB June meeting minutes revealed that the ECB remains on track to exit the ultra-loose monetary policy this year.

All eyes now remain on the much-awaited US payrolls data, which will determine whether the Fed will initiate balance sheet normalization from Sept. In the meantime, the USD dynamics and risk trends will influence the spot.

EUR/USD Technical Levels

According to Haresh Menghani, Analyst at FXStreet, “With short-term indicators holding comfortably in positive territory, the pair's latest leg of up-move from the 1.1300 neighborhood, marking 50% Fibonacci retracement level of 1.1172-1.1446 up-swing, seems more likely to get extended towards 61.8% Fibonacci expansion level of the mentioned up-move and subsequent retracement. A follow-through buying interest should help the pair to reclaim the key 1.1500 psychological mark and aim towards testing its next major hurdle near 1.1530-35 region.”

“On the downside, any retracement back below the 1.1400 handle now seems to find support at 23.6% Fibonacci retracement level near 1.1380 area, below which the pair could head back towards 1.1340-35 region (38.2% Fibonacci retracement level) en-route the 1.1300 round figure mark,” Haresh adds.