EUR/USD: Corrective slide stalls near 1.0850, 1.09 back on sight?

The overnight retreat in EUR/USD stalled just ahead of the mid-point of 1.08 handle, as the bulls look to regain control amid faltering recovery in the greenback versus its main peers, in response to  Dallas Fed president Kaplan’s remarks. Fed’s Kaplan: Fed would be wise to move gradually and patiently

Moreover, markets sold-off the US dollar once again on the latest Trump headlines, citing that the “Trump administration is looking at driving tax reform and infrastructure concurrently,” raised renewed concerns over the effectiveness of the Trump’s government, especially after last week’s Healthcare Bill failure. The USD index met fresh sellers near 99.10, reverting to 99 handle, shaving-off minor-gains.

However, it remains to be seen if the spot manages to regain 1.09 handle as the shorter-duration treasury yields, which mimics short-term Fed’s interest rates outlook, outperforms, while recovery in the Asian equities could also cap further upside in EUR/USD.

Calendar-wise, we have a data-empty EUR docket and hence, focus remains on the US CB consumer confidence data and regional manufacturing index due later in the NA session. Besides, FOMC member Kaplan will hit the wires once again later today.

EUR/USD Technical Levels   

Valeria Bednarik, Chief Analyst at FXStreet explains, “The 4 hours chart for the EUR/USD pair shows that the price is well above the 1.0820/30 region, the 50% retracement of the post-US election's decline and former yearly high, while the 20 SMA keeps advancing below it. Technical indicators in the mentioned chart have lost upward strength, pulling modestly lower within overall readings, not enough to suggest further declines ahead. Buying interest is likely waiting in the mentioned 1.0820/30 region, although a break below it could result in a slide down to 1.0790, where the pair will fill the weekly opening gap. Support levels: 1.0765 1.0730 1.0700 Resistance levels: 1.0830 1.0870 1.0910s.”