01.09 - EUR/USD’s upside faltered just below the key mark

The buying interest around the single currency remains well and sound for yet another session and is now lifting EUR/USD to the boundaries of the psychological 1.20 mark, clinching at the same time fresh 2020 highs. EUR/USD broke above the multi-day rangebound theme last week and managed to test the vicinity of the key 1.20 mark earlier on Tuesday. In the meantime, the sell-off in the dollar gives extra legs to the rally that started in July, all accompanied by the improved sentiment in the risk-associated universe, auspicious results from domestic fundamentals - which have been in turn supporting further the view of a strong economic recovery following the coronavirus crisis – as well as US-China positive headlines.

Also lending wings to the momentum around the euro appear the deal on the European Recovery Fund – which helped to put political fears within the bloc to rest (for now) – and the solid position of the current account in the region. In addition, the speculative community has supported the bullish stance on the euro for yet another week