EUR/USD extends rally above 1.1200, eyes 2017 high

EUR/USD remains strong, holding on top of 1.1200. The pair reached a fresh high at 1.1246, during the American session, the highest level in six days. It is trading at 1.1245, up for the second day in a row and more than a hundred pips above yesterday’s lows. 

A weak US dollar pushed the pair to the upside. The greenback remains weak against European currencies and the yen while it rises versus commodity currencies. The rally in EUR/USD is taking place amid a decline in US bond yields and falling equity prices on Wall Street. US economic data did not offer support to the greenback. During the second half of the American session, the Beige Book will be released. The key report of the week will be the NFP on Friday. 

US: Fed’s Beige Book in focus today – BMO CM

The Chicago PMI declined from 58.3 to 55.2 in May
 

Breaking important resistance

The euro broke during the European session a downtrend line at 1.1210 and managed to remain on top, adding support to the rally. In the short-term, the bias favors the upside, particularly if the price holds on top of the mentioned line. 

To the upside, the next target for the pair could be seen at 1.1267, the 2017 high, and above here, attention would turn to 1.1300. If the pair fails to hold above 1.1240/45, it could correct toward 1.1205. A decline under 1.1205 would remove strength out of the pair and the greenback would gain momentum.