1. Market reports: German Manufacturing and Services PMI beat estimates, Business and Consumer confidence are rising. US PMIs and Consumer Confidence are also up, but the USD is currently more focused on yields and risk sentiment.
News: Accelerated vaccination efforts in the eurozone to support the EUR against other currencies.
Risk Sentiment: Risk sentiment is likely going to be supportive for the EUR in the coming week due to higher vaccination rates. New German lockdown measures had a muted impact on the pair.
Technicals: Technicals look very with Friday’s close. Strong candle on the weekly, fresh higher high, and previous retest of the 61.8% Fib level. Buying seems supported by higher . Pair reaching 6-week high.
BEARISH FOR THE PAIR:
Currency Strength Index:
EUR is the strongest for the week, USD the weakest. Looks like mean reversion could drive the pair lower in the next week.
== HOW TO TRADE? ==
While profit-taking activities and yield differentials could drive the pair lower from current levels, pullbacks look like a nice opportunity to buy. Only a fall below 1.2000 would turn the bias . The 1.618% Fib extension could be on the table.
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