HelenRush

EURUSD upside bias looks vulnerable

FX:EURUSD   Euro / U.S. Dollar

EURUSD is consolidating previous gains on Tuesday, with the pair has settled around the 1.13 psychological level. Despite some softness, the dollar is holding rather firm as traders are focused on US-China trade talks in Washington due to resume on Thursday.

So, in the coming days, the greenback will likely remain rather robust, if, of course, the FOMC meeting minutes don’t disappoint by a dovish tone. Despite the upside bias, EURUSD recovery still looks rather modest and vulnerable as the economic data from the euro zone continue to fuel concerns over slowing growth, especially in Germany. The economy was flat in the fourth quarter after contraction in the previous quarter, first since 2015.

Technically, the pair needs to hold above 1.13 in the near term in order to target the 1.1325 intermediate resistance on the way to 1.1340 and then 1.1360. A break below 1.13 will open the road to 1.1270 and 1.1250. Should the upside bias stall, the euro could turn lower for the day. Further dynamics will depend on the tone of the FOMC minutes.