EUR/USD holds a break above the 200-hour moving average
The bulk of the euro strength we’re witnessing here comes from EUR/GBP flows but is also helping to drive EUR/USD higher over the past few sessions. Of note, the pair has now broken back above the 200-hour MA (blue line) as buyers regain near-term control.
After some poking and prodding around 1.1130, we’re finally seeing a break higher in the pair towards the swing region around 1.1150-62 next.
I’m still not sold on the euro’s fundamentals in the big picture and as such, the move higher here could be an opportunity for sellers to reload on shorts. However, flows are the dominant factor in markets at the moment and it’s hard to argue against the break higher in EUR/GBP as the pair looks towards the 2017 high around 0.9300.
As for EUR/USD itself, I’d be more keenly eyeing a move towards 1.1200 and the 100-day moving average @ 1.1232 for further areas to lean on. The market focus will grow more towards the ECB easing in September later in the month and I reckon that’s when we’ll get more corrective action in the pair towards the downside again.