EUR/USD rebounds to test 1.0700 as USD retreats

The bid tone seen around the US dollar weakened sharply in the European session, prompting a sharp reversal in EUR/USD, in a bid to regain 1.07 handle.

EUR/USD bounces-off 1.0670

Currently, the spot trades modestly flat at fresh session highs of 1.0697, having regained 100-DMA barrier. The EUR/USD pair made a solid comeback this session, mainly driven by renewed selling interest around the greenback against its main competitors. Meanwhile, the USD index trades at 100.25, down from 100.41 highs, still up +0.11% on the day.

While the EUR bulls also appear to cheer latest German trade report that revealed Germany’s global trade surplus in 2016 hit a fresh record high. WSJ reports, “Germany’s trade surplus—or the balance of exports and imports of goods—increased to €252.9 billion ($270.58 billion), which marks the highest surplus since records began after World War II, the statistics body said Thursday. Total exports of goods rose 1.2% from 2015, while imports increased just 0.6%.”

In the day, we have no major economic releases on the card, except for the US weekly jobless claims, and hence, speeches from FOMC officials Evans and Bullard will grab a lot of eyeballs, in wake of poor NFP report and uncertainty over Trump’s policies.

EUR/USD Technical Levels

In terms of technicals, the pair finds the immediate resistance 1.0700 (zero figure). A break beyond the last, doors will open for a test of 1.0719/23/40 (5, 20 & 10-DMA) and from there to 1.0780 (key resistance). On the flip side, the immediate support is placed at 1.0655 (Jan 26 low) below which 1.0617 (Jan 30 low) and 1.0593 (50-DMA) could be tested.