EUR/USD side-lined near 1.0400, EZ PMIs, CPI eyed

EUR/USD is seen trading around a flat-line as we head into the early European trading, closely tracking a brief consolidation phase in the US dollar, and eagerly awaits Eurozone dataflow for fresh impetus.

EUR/USD: Stiff resistance placed at 1.0458

Currently, the spot trades almost unchanged at 1.0404, having posted a day’s highs at 1.0424 and day’s low at 1.0390. The main currency pair is seen making another attempt to survive above 1.04 handle in early trades, but remains vulnerable amid ongoing USD strength, in wake of latest upbeat US ISM manufacturing PMI and construction spending data.

More so expectations of higher interest rates amid a hawkish Fed and Trump’s fiscal boost continues to boost the greenback at the expense of the euro. On the other hand, political concerns around the Eurozone combined with lingering Italian banking crisis, will keep the EUR broadly undermined going forward.

In the meantime, the major looks forward to the final services PMI reports from across the Euro area, followed by the bloc’s flash CPI estimate, which will be reported ahead of the FOMC minutes due later in the American afternoon.

EUR/USD Technical Levels

In terms of technicals, the pair finds the immediate resistance 1.0458 (10 & 20-DMA). A break beyond the last, doors will open for a test of 1.0485 (daily R1) and from there to 1.0500 (zero figure). On the flip side, the immediate support is placed at 1.0352 (Dec 20 low) below which 1.0339 (multi-year low) and 1.0300 (zero figure) could be tested.