EUR/USD minor recovery back on robust 1.17 handle, headed back to 1.1850?

Currently, EUR/USD is trading at 1.1735, down -0.37% on the day, having posted a daily high at 1.1793 and low at 1.1687.

EUR/USD has recovered back onto the 1.17 handle after a strong sell-off from the 1.1847 highs scored last week. The dollar has been offering profits off the table and recent strong data has fueled further upside, +0.49% in the DXY today within a range of between 93.435 - 94.139 yet still -8.16% YTD.  

The euros 52wk range has been between 1.0341 - 1.1910 with a YTD return of 11.40% so far, propelled forward by concerns over the US economy's ability to meet the 2% inflation target in the medium term and a reversal of the Trumflation trade while, otherwise, the ECB has become more hawkish and bullish over the EZ economy. 

As for today, analysts at Scotiabank reported that Germany put up a 0.6% gain in GDP growth for Q2, a little below median expectations for a 0.7% gain. "The EUR slipped slightly on the data but there is little here to really move the market decisively one way or the other – the broader Eurozone economy performed well in H1 and supports the impression that the ECB will roll back some monetary accommodation next month," the analysts argued.  

US: Retail sales for July 2017 were $478.9 billion, an increase of 0.6% from June

For the US session, retail sales figures for July are very good, rising 0.6%MoM in July versus the consensus 0.3% forecast, as noted by analysts at ING Bank, adding, "there were also big upward revisions from -0.2%MoM to +0.3%MoM for June. We think inflation will be back at the 2% target by the end of the year and also predict a December Fed rate hike. We continue to expect two more 25bp hikes next year."

EUR/USD levels

"We expect firm support and rather think intraday risks may be tilted a little higher for EURUSD from here intraday," explained the analysts at Scotiabank argued that 1.17/1.1850 should cover the near-term range for spot. 

"Resistance above the 1.1910 recent high lies at 1.2042, the 2012 low, then 1.2168, the 50% retracement from the move down from the 2014 high," explained analysts at Commerzbank.