EUR/USD regains poise, clocks fresh 2-1/2 year highs near 1.1870

The steady recovery in EUR/USD from below 1.18 handle gathered steam in the European session, with the bulls now driving the rate closer towards 1.1900 levels.

EUR/USD: Will it conquer 1.19 handle ahead of US ADP?

The US dollar dived back near fifteen-month lows against its main competitors, which provide extra legs to the recent bullish momentum seen in EUR/USD. Markets continue to cheer the latest upbeat Eurozone growth and inflation numbers, which drives the ECB closer towards unwinding of its ultra-loose monetary policy program.

Moreover, the major also benefits from cross-driven strength, as the EUR/GBP cross jumped higher, after Cable ran into 1.3250 resistance following the release of disappointing UK construction PMI data.

Looking ahead, markets eagerly await the US ADP jobs report that will be reported in the NA session, as the Eurozone PPI data due out shortly is expected to virtually have no impact on the prices.

EUR/USD Technical Set-up  

According to  Slobodan Drvenica at Windsor Brokers Ltd: “Lift above 1.1850 zone would trigger stops parked just above and spark fresh upside extension towards 1.1900 zone (FE 176.4%) and key targets at 1.1950 (monthly cloud base) and psychological 1.2000 barrier. Overbought daily studies warn of pullback but so far without clearer signal.
Tuesday's low at 1.1785 marks initial support, followed by rising 10SMA at 1.1728, which guards 20SMA at 1.1586.”