Breaking: EUR/USD rises above 1.17 for first since September 2018

EUR/USD has crossed above 1.17 for the first time in 22 months, taking the cumulative month-to-date gain to 4.23%.  The American dollar is being sold across the board amid gold's rally to record highs above the September 2011 high of $1,920.

The EUR/USD pair has closed a sixth consecutive day with solid gains near the mentioned high, overbought but still bullish. In the daily chart, technical indicators are partially losing their bullish strength but hold well into extreme levels, while the 20 SMA turned heads north almost vertically, well below the current level. A corrective decline could take place, but the overall stance is bullish. In the shorter-term, and according to the 4-hour chart, the risk remains skewed to the upside, as the pair continues to develop above a bullish 20 SMA. The Momentum indicator diverges lower within positive levels, but the RSI maintains its strength around 69.

Support levels: 1.1630 1.1590 1.1545

Resistance levels: 1.1660 1.1695 1.1730

Upbeat data elsewhere and increased concerns about the pandemic situation in the US has played against the greenback throughout the week and despite the risk-averse environment. Investors moved into other safe-haven assets, such as gold, the CHF, or the JPY.

The shared currency, on the other hand, continued to find support in the EU coronavirus recovery fund, agreed mid-week, and the preliminary estimates of the Markit July PMI, which were much better than anticipated. For the EU, the manufacturing PMI rose to 51.1 from 47.4 while services output jumped to 55.1 from 48.3. German indexes returned to expansion territory, also beating the market’s expectations. The Markit preliminary estimates for the US, on the other hand, missed the market’s expectations, with the Services PMI at 49.6 and the manufacturing index printing at 51.3.

Reprinted from fxstreet, the copyright all reserved by the original author.