EUR/USD remains under pressure near 1.1440 ahead of ECB

• EUR/USD looks side-lined around the 1.1440 region on Monday.
• German 10y Bund yields add to Friday’s decline near -0.28%.
• EMU Trade Balance figures, ECB Lagarde next in the calendar.

The single currency struggles for direction and motivates EUR/USD to navigate the 1.1440 region at the beginning of the week.

EUR/USD now focuses on Lagarde, dollar

The outlook for EUR/USD remains fragile to say the least, while it keeps trading close to the region of recent 2021 lows near 1.1430 (November 12) on Monday.

The uninterrupted buying interest around the greenback continues to keep the pair under intense pressure, always with the door open to the continuation of the decline for the time being. The neutral/bid stance in the buck comes despite lower yields on both sides of the Atlantic.

In the domestic calendar, September’s trade balance figures in the broader Euroland are due next ahead of the speech by Chairwoman C.Lagarde at the European Parliament. In the NA session, the only publication will be the NY Empire State Index and auctions of 3m and 6m bills.

What to look for around EUR

EUR/USD recorded new lows near 1.1430 on Friday, as the outlook for the pair continues to deteriorate. As usual, the pair’s price action is predicted to mainly track the dynamics around the dollar, while bouts of intermittent strength expected to come from the improvement in the risk complex. On the more macro view, the loss of momentum in the economic recovery in the region - as per some weakness observed in key fundamentals – coupled with rising cases of COVID-19 is also seen pouring cold water over investors’ optimism. Further out, the euro should remain under scrutiny amidst the implicit debate between investors’ speculations of a probable lift-off sooner than anticipated and the ECB’s so far steady hand, all amidst the tenacious elevated inflation in the bloc and inceasing conviction that it could last longer than previously anticipated.

Key events in the euro area this week: EMU Trade Balance, ECB Lagarde (Monday) – EMU Flash Q3 GDP, ECB Lagarde (Tuesday) – EMU Final CPI, ECB Lagarde (Wednesday) – ECB Lagarde (Friday).

EUR/USD levels to watch

So far, spot is up 0.03% at 1.1446 and faces the next up barrier at 1.1575 (20-day SMA) followed by 1.1609 (weekly high November 9) and finally 1.1616 (monthly high Nov.4). On the other hand, a break below 1.1432 (2021 low Nov.12) would target 1.1422 (monthly high Jun.10 2020) en route to 1.1300 (round level).