EUR/USD’s rebound stalls right ahead of 1.1670

• The euro returns above 1.1600 to approach Octpober's top at 1.1670. 
• US dollar weakness allows for further euro appreciation.
• EUR/USD: On a recovery mood, heading towards 1.1741 – Commerzbank.

The euro keeps crawling higher against a somewhat softer US dollar on Wednesday, on track to complete a three-day recovery. The pair has confirmed above 1.1600 earlier today to ease negative pressure, before hitting resistance right below October’s peak, at 1.1670.

The euro takes advantage of a weaker US dollar

The common currency has been buoyed by a weaker greenback again on Wednesday, with the US dollar is losing ground on the back of upbeat quarterly earnings in the Healthcare sector. Better than expected earnings reported by Anthem and Abbott Laboratories have eased investors’ fears about surging inflation and supply chain disruptions.

In this background, the US Dollar Index has retreated further from the one-year high at 94.50 hit last week, reaching session lows at 93.50 area, 1% below last week’s top. The positive market sentiment has been reflected on moderate advances in Wall Street, with the S&P 500 Index rallying for the sixth consecutive day to test year-to-date highs at 4,545. The Dow Jones Index is 0.45% up, while the Nasdaq has dipped into negative territory halfway through the session to trade nearly flat at the moment of writing.

EUR/USD: Seen appreciating beyond 1.1700 – Commerzbank

Karen Jones, Team Head FICC Technical Analysis Research at Commerzbank, sees the pair in a recovery mood, targeting 1.1741: “EUR/USD is in recovery mode near-term. The intraday Elliott wave counts remain positive and we would allow for a deeper retracement to the 1.1741 four-month downtrend.”

Technical levels to watch