EUR/USD surrenders gains, back near 1.0720 ahead of data

The single currency has faded its earlier bull run to the 1.0740 area vs. the buck, now prompting EUR/USD to recede to the 1.0725/20 band.

EUR/USD attention to data

Spot has started the week on a positive footing, advancing to daily tops around 1.0740 during overnight trade, although now easing some ground ahead of the opening bell in the Old Continent.

Always against the backdrop of a weaker greenback, the pair continues to look for a sustainable breakout of the 1.0700 handle, as uncertainty remains well and sound over the potential policies under Trump’s administration.

The better tone of EUR in recent weeks also finds support from the positioning front, with speculative net shorts deflating to levels last seen in late May, around 52.3K contracts during the week ended on January 24 and according to the latest CFTC report.

Data wise today, European Commission’s Consumer Confidence is due along with other sentiment gauges in the euro area, while advanced German inflation figures for the current month will also take centre stage.

Across the pond, inflation figures tracked by the PCE area due followed by Personal Income/Spending and December’s Pending Home Sales.

EUR/USD levels to watch

The pair is now gaining 0.20% at 1.0720 facing the next hurdle at 1.0775 (high Jan.24) followed by 1.0798 (high Dec.5) and then 1.0873 (high Dec.8). On the flip side, a breakdown of 1.0699 (short-term support line) would target 1.0655 (low Jan.26) en route to 1.0633 (20-day sma).