- DXY rebound gathers steam.
- German political fallout weighs.
- Eurozone Final CPI in focus.
The EUR/USD pair is seen extending its corrective slide from three-year tops of 1.2323, now heading for a test of the 1.2200 support, as broad-based US dollar rebound gains traction in early Europe.
The spot returned to the red zone, as markets resorted to repositioning ahead of the key Eurozone final CPI data while the German political headwinds, after the SPD rejected the coalition talks with Merkel’s Conservatives, also continue to undermine the sentiment around the EUR.
Meanwhile, the pair also weighs the latest ECB headline, citing that the ECB is unlikely to drop the pledge to QE program until inflation hits the target next week.
Markets now look forward to the Eurozone final CPI and US industrial figures due later on Wednesday for fresh trading impetus.
EUR/USD Technical Levels
Haresh Menghani, Analyst at FXStreet, notes: “Any meaningful corrective slide might continue to find some support near the 1.2210-1.2200 region, which if broken is likely to accelerate the fall towards 1.2170 intermediate level en-route the 1.2120-10 support. On the upside, the 1.2290-1.2300 region might continue to act as an immediate hurdle, above which the pair might now surpass intraday highs resistance near 1.2325 level and aim towards testing 1.2370-75 supply zone en-route the 1.2400 handle.”
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