The boom in technical of the pair EUR/USD at the american session it exceeded above the threshold of 1.18 for the first time in over 31 months. At this time, the pair is trading at 1.1815, 15 points below its record high of 1.1830, earning up to 65 pips, or 0.55%, on the day.
After spending the better part of the day in a set range around the opening levels, the pair gained momentum just around the close of London session in the midst of flows of the month and has gained nearly 50 pips in a matter of minutes.
After the initial reaction, the pair consolidated its gains for the next hour, but it gained traction once more to break above 1.18. The movement appears to be a product of the weakness of the greenback with the dollar index of the EE.U.S. falling to its lowest level since may of 2016.
At this time, the index is at 92.85, losing 0.36% on the day. The last day’s data of united States, Index of manufacturing businesses of the Dallas Fed, improved to 16.8 in July from 15 in June, but did not help the USD recoup its losses, and that was largely ignored by market participants.
On Tuesday, the economic calendar includes the manufacturing PMI from markit and the growth of GDP in the second quarter of the euro zone before the Price Index of Personal Consumption Expenditures, the inflation indicator favorite of the Fed. The market expects that the Price Index Core PCE is stable to 0.1% on a monthly basis in June.
The technical indicators the pair is showing signs of overbought in this time, suggesting that a short term technical correction could be underway. 1.1870 (maximum of January 11, 2015) could be the initial obstacle for the couple before 1.1950 (maximum January 4, 2015) and 1.2000 (psychological level).
On the downside, supports are located at 1.1720 (daily minimum), 1.1620 (minimum of 21 of July) and 1.1500 (psychological level).