EUR/USD: Failed Once Again At 1.1280/90

• EUR/USD has once again failed at 1.1280/90.
• Prospects of ECB easing keep weighing on sentiment.
• Bearish view unchanged below the 200-day SMA.

Yesterday’s bull run in EUR/USD met a significant (and recurrent) hurdle in the 1.1280/90 band, where converge the 21-day SMA and last week’s tops. Dovish Fedspeak sponsored the rally in spot, this time by NY Fed J.Williams, who reinforced the idea that a Fed’s rate cut later this month is a done deal… at least a 25 bps rate cut.

That said, the pair managed to shrug off Thursday’s dovish news involving the likeliness that the ECB could revamp its inflation goal, all immersed in the already shared view that further accommodative measures are in the pipeline and are likely to be announced at the July or September meeting.

In spite of occasional bullish attempts, which are mostly expected to come in from the USD-side, EUR is seen under increasing pressure in the upcoming weeks as market participants keep assessing the potential easing measures from the ECB as well as the unremitting deceleration in the region.

EUR/USD thus faces initial resistance at the 1.1280/90 band. A surpass of this area should open the door to a visit of the more relevant 200-day SMA near 1.1320. Above it, the downside pressure should lose momentum, allowing at the same time for a probable test of June tops around 1.1420. On the downside, there are some interim supports at 1.1193 (July low), 1.1181 (June 18 low) and 1.1176 (March 7 low), ahead of 2019 low in the 1.1100 neighbourhood.

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