The Euro (EUR) inched lower against the US Dollar (USD) on Monday, decreasing the price of EURUSD to less than 1.1750 following some key economic events. The technical bias has however turned bullish because of a higher high in the recent upside rally.
EUR/USD Technical Analysis
As of this writing, the pair is being traded near 1.1743. A hurdle may be noted around 1.1800 (a short-term horizontal resistance area as well as psychological number) ahead of 1.1876 (the low of 2010) and then 1.1900 (the psychological number).
On the downside, a support can be noted around 1.1332 (a key horizontal support) ahead of 1.0839 (the low of the last major downside move) and then 1.0800 (the confluence of horizontal support as well as psychological number) as demonstrated in the given above chart. The technical bias shall remain bullish as long as the 1.0839 support area is intact.
Eurozone Construction Output
The Euro area construction output data for the month of June was released today. Production in construction was down in the currency bloc. Seasonally adjusted production in construction sector dropped 0.5 percent in euro area, showed Eurostat. On a year-on-year basis, production in construction rose 3.4 percent. Looking at the data, it seems to be disappointing, with production dropping for the second straight month, after falling 0.2 percent sequentially in May. The decline was led by a second straight fall of 1 percent or more in Germany, with French output down too and, by sub-sector, building and civil engineering work both retreating. But this is not overly concerning and the sector is believed to be in a recovery phase, noted Daiwa Capital Markets Research. The print continues to be strong on a year-on-year basis though.
Considering the overall technical and fundamental outlook, buying the pair around current levels may be a good strategy in short to medium term.
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