FXStreet (Mumbai) - EUR/USD stalls its downward spiral near the 200-DMA located at 1.1078 and retreated slightly towards 1.11 handle while Asian traders enjoy the persisting risk-on trades as markets see more easy money coming in Dec as hinted by the ECB on Thursday.
EUR/USD pressured on ECB QE extension/expansion prospects
The EUR/USD pair trades -0.10% lower at 1.1094, having breached the 1.11 barrier in early Asia. The major appears to consolidate the previous slump and finds fresh bids near 200-DMA, offering some respite to the EUR bulls. However, the minor-recovery is likely to be short-lived as the Draghi’s dovish comments at the ECB post decision presser continue to weigh on the common currency.
The EUR/USD pair plummeted over 200-pips on Thursday after the ECB Chief said during his press conference that the central bank is ready do more if required and will reassess the QE program in Dec. ECB left the key rates unchanged at its policy meeting.
Later today, the major will track the sentiment on the European stocks as dust settles over the ECB aftermath. While final manufacturing PMIs from the Euro zone and Germany will fill in an otherwise data-quiet EUR calendar.
EUR/USD Technical Levels
The pair is testing the 200-DMA support located at 1.1078 with the next immediate support in sight at 1.1023/1018 (Aug 12 Low + daily S1), a breach of the last would expose 1.0850 (August lows) levels, below which floors open for a test of 1.10764 (daily S3). While the recovery could see the immediate resistance at 1.1111 (h1 10-SMA), beyond which 1.1185 (daily pivot) would be tested and from there to 1.1200 (round number).
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