EUR/USD is making a move out of range and shooting above 1.14. Finally, after too many freezing days in a narrow range around 1.13. The peak so far is 1.1422.
US retail sales dropped by 0.8%, double the early expectations. The US dollar has been on the back foot also against other currencies.
FOMC member Charles Plosser, which is known hawk is also disappointed with the data. Hearing relatively dovish words from a hawk probably weighs on the dollar as well.
It’s important to note that when excluding autos and gas (which dropped sharply with global oil prices), sales rose by 0.2% – a pale silver lining.
The euro is not worried about the lack of progress on the Greek crisis. The Eurogroup deliberations ended in no conclusion, with a more important meeting on Monday.
The optimism about a solution for Ukraine is also good news for the euro. Putin announced a ceasefire agreement has been reached in Ukraine. While it is still to be seen if this time is different and that it lasts, lower tensions between Russia and the West serve as an economic boost to the German economy.
Resistance awaits at 1.1460, which was a low for the pair on its way down. Further resistance stands at 1.1540.
Support is at the November 2003 at 1.1373, followed by 1.1290.
Tomorrow we have initial GDP data from the euro-zone. See how to trade the German GDP with EUR/USD.
Here is how it looks on the chart:
