EUR/USD gathers some attention, back to 1.0560 ahead of ADP

After bottoming out in the vicinity of 1.0540, EUR/USD has now picked up some pace and has returned to the 1.0560/65 band.

EUR/USD focus on US docket

The pair has come under renewed selling pressure in early trade, although some decent support seems to have emerged around 1.0540 ahead of the key US ADP report, with consensus expecting the private sector to have added nearly 200K jobs during last month.

Expectations of a Fed move at the March meeting stays on the rise so far today, with Reuters’s Fedwatch placing the probability of a 25 rate hike next week just above 87%, all adding to the already solid performance of the greenback. The US Dollar Index is advancing for the third straight session so far, testing daily highs in the boundaries of the key barrier at 102.00 the figure.

Adding concerns to EUR, French election polls (OpinionWay) continue to show far-right candidate Marine Le Pen leading the vote intentions for the first round, although she would likely lose in a hypothetical second round vs. either candidates E.Macron or F.Fillon.

On the data front, German Industrial Production expanded more than expected during January at a monthly 2.8%, while French trade deficit more than doubled to nearly €8 billion during the same period.

EUR/USD levels to watch

At the moment the pair is losing 0.10% at 1.0555 and a break below 1.0513 (low Mar.1) would target 1.0499 (low Mar.3) en route to 1.0492 (low Mar.2/Feb.22). On the upside, the initial hurdle is located at 1.0588 (20-day sma) followed by 1.0606 (55-day sma) and finally 1.0640 (short term resistance line).