EUR/USD analysis: dollar gains traction after early losses

Valeria Bednarik FXStreet

EUR/USD Current price: 1.2310

ECB's Draghi testimony delayed, probably the most relevant event of the day.
EUR/USD nearing 1.2300 as dollar regains its poise.

The EUR/USD pair retreats from a daily high of 1.2354, as the dollar started the day with a soft tone but recovered mid-European morning. The absence of relevant headlines coming from the EU is keeping the pair within familiar ranges, and sentiment is once again, leading the way for currencies, with speculative interest watching equities and yields. ECB's head Draghi is about to start its testimony before the European Parliament Economic and Monetary Affairs Committee, on monetary policy and inflation outlook probably the most relevant event of the day. The US will release its January New Home Sales figures, and some local Fed's indexes, these last, hardly relevant in terms of price action. In the meantime, US equities are strongly up in pre-opening trading, although is yet to be seen if they will be able to hold on to gains.

Technically, the pair approaches 1.2300 after meeting selling interest around a bearish 100 SMA, now also below the 200 SMA and near a flat 20 SMA in the 4 hours chart. Indicators in the mentioned time frame have turned south, with the RSI already within negative territory. Below 1.2300, the pair has room to extend its decline towards 1.2260, the low set at the end of last week, while further declines expose the 1.2205 level, February monthly low.

Support levels: 1.2300 1.2260 1.2205

Resistance levels: 1.2340 1.2380 1.2420

View Live Chart for the EUR/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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