EUR/USD sits at fresh 6-month highs as USD selling remains unabated

The EUR/USD pair continued gaining traction and was seen building on its strong up-move over the past couple of day, now placed at fresh 6-month tops around 1.1060-65 region.

After an initial subdued reaction to a slight disappointment from the release of German ZEW economic sentiment index, coming-in at 20.6 for May as against 22.0 expected, the pair caught fresh bids as the finer details revealed that the Current Conditions index continues to improve and jumped to its highest level since July 2015.

   •  Germany: May ZEW index points to continued strong growth of the economy - ING

Adding to this, the preliminary Euro-zone GDP print confirmed that the economy grew by 0.5% in the first quarter of 2017, with yearly growth holding steady at 1.7%. Other data released on Tuesday showed Euro-zone trade surplus jumped to €23.1 billion during March and remained supportive of the strong bid tone surrounding the common currency.

   •  Eurozone: Strong growth in Q1, but can it last? - ING

Meanwhile, the prevalent strong bearish bias surrounding the greenback, with the key US Dollar Index sinking to 6-month lows, further collaborated to the pair's strong up-surge to the highest level since the US Presidential election. 

Next on tap would be the US economic docket, featuring the release of housing market and industrial production data, which if adds to the recent slew of downbeat US macro data would aggravate the greenback selling pressure and continue boosting the pair during the NA session.

   •  US: Industrial production and housing data in the limelight - Rabobank

Technical levels to watch

From currently levels, the 1.1100 handle is likely to act as immediate hurdle, which if cleared could accelerate the up-move further towards 1.1150-55 intermediate resistance before the pair aims to reclaim the 1.1200 handle.

On the flip side, any retracement below 1.1040-35 area now seems to find fresh buying interest near the 1.1000 handle and any further corrective slide now seems limited and should find strong support near 1.0970-65 zone.