EUR/USD losing the grip below 1.2300
- The single currency is on the defensive on Italian headlines.
- USD trades on a firm note, recovers part of recent pullback.
- Services PMIs, Sentix, Italian elections will be in the limelight today.
The demand for the European currency remains subdued early in the Old Continent, taking EUR/USD to the 1.2300/1.2295 area as markets continue to look to the unclear results from the Italian elections.
EUR/USD weaker on Italy, looks to data
After two consecutive sessions with gains, the pair is now losing some momentum following the likely hung government at the Italian elections over the weekend. In fact, the 5-Star Movement gets around 31.5% of votes, seconded by PD with 19.2% while Berlusconi’s Forza Italia remains below 14% for the time being, in the 4th place.
News from a German grand coalition government led by Chancellor A.Merkel gave some oxygen to EUR during the Asian trading hours, although later developments from Italy eclipsed the initial optimism.
News from the speculative community saw EUR net longs climbing to 3-week tops during the week ended on February 27, according to the latest CFTC report.
It should be quite an interesting week for the pair, as calendar is plenty of significant publications plus the ECB meeting on Thursday. Today, final February Services PMIs Euroland and the Sentix index are coming up next.
In the US docket, the ISM Non-manufacturing is due along with the speech by FOMC’s R.Quarles.
EUR/USD levels to watch
At the moment, the pair is losing 0.19% at 1.2294 facing immediate contention emerges at 1.2206 (low Feb.9) seconded by 1.2195 (low Jan.18) and finally 1.2153 (low Mar.1). On the upside, a breakout of 1.2338 (high Mar.5) would target 1.2401 (short-term resistance line) and then 1.2557 (2018 high Feb.18).
