The Single Currency hit our 1.18 target following ECB’s concerns over rising Euro which threatens the Eurozone economic recovery. 1.20 could be the top for the Euro following ECB’s Lane comments “the 1.20 level in EUR/USD matters”, as it looks like the FX intervention may have begun. Consequently, the dollar bulls retain the driver’s seat despite upbeat China Caixin Services PMI and risk-on mood. From a technical perspective, the European currency is approaching towards a critical support zone where we find the 200-period SMA, the 5-month trend line and the 1.17 major support. The bears need to find enough momentum and take out all of these levels to reverse the trend.
Support: 1.1760 / 1.17
Resistance: 1.1850 / 1.19
