EUR/USD is back above 1.1700 again, touching a high of 1.1721 on the day
The dollar is noticeably weaker as we get the new week going, but the euro is the strongest performing major currency on the day so far. With political developments in Italy still hanging in the balance, it seems that traders/investors are favouring uncertainty over the possibility of Savona taking over as economy minister - and pushing forward with euroskeptic plans.
EUR/USD is trading at the highs for the day currently, moving towards a test of the 100-hour MA (red line) @ 1.1726. That will be a key level for sellers to hold in order to retain the near-term bearish bias in the pair. With little on the economic calendar today, look out for large expiries at 1.1700 too that should provide a magnet in what should be a flow-driven day.
Another key level to watch out for will be on the daily chart, in the form of the 38.2 retracement level @ 1.1709. In essence, staying above 1.1700 would be a good platform for buyers to build on in the coming days to make their case for any move to the upside.
But watch out for any twists and turns on the political front in Italy, and also now with the added periphery risk arising from Spain too.
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