EUR/USD alternates gains with losses above 1.1800

• EUR/USD struggles for direction above the 1.18 mark.
• The ECB accounts are coming up next in the docket.
• Initial Claims, Philly Fed Index next of note in the NA session.

The renewed selling bias around the shared currency has dragged EUR/USD to as low as the 1.1810 region earlier on Thursday, clinching at the same time fresh multi-day lows.

EUR/USD looks to data, risk trends

EUR/USD is alternating gains with losses on Thursday following Wednesday’s sharp pullback from the area well above the 1.19 barrier, levels last seen back in May 2018.

The profit taking mood among investors in the wake of the strong July-August rally appears to be dominating the sentiment for the time being in combination with fresh demand for the greenback.

Indeed, the gloomy assessment of the US economy seen in the FOMC minutes (Wednesday) plus the uncertainty still prevailing in the US political scenario and some US-China effervescence appear to have lent some support to the buck, thus forcing the pair to trade in a soft tone.

In the euro docket, German Producer Prices rose 0.2% MoM in July and contracted 1.7% from a year earlier. Later, the ECB will publish its accounts of the last meeting. Across the pond, the weekly Claims are due followed by the Philly Fed manufacturing gauge.

What to look for around EUR

EUR/USD is coming under pressure after hitting fresh tops near 1.1970 earlier in the week. The July-August rally, while largely triggered by broad-based dollar-selling and improved sentiment in the risk-associated universe, found extra sustain in auspicious results from domestic fundamentals, which have been in turn supporting further the view of a strong economic recovery following the coronavirus crisis. Also lending wings to the momentum around the euro appear the deal on the European Recovery Fund – which helped putting political fears within the bloc to rest (for now) – and the solid position of the current account in the region.

EUR/USD levels to watch

At the moment, the pair is losing 0.02% at 1.1835 and faces the next support at 1.1695 (monthly low Aug.3) followed by 1.1495 (monthly high Mar.9) and finally 1.1448 (50% Fibo of the 2017-2018 rally). On the upside, a breakout of 1.1965 (2020 high Aug.18) would target 1.1996 (high May 14 2018) en route to 1.2032 (23.6% Fibo of the 2017-2018 rally).