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EUR/USD re-takes 1.1400, European stocks drop further

FXStreet (Mumbai) - The bid tone in the EUR/USD pair remains intact in the mid-European session, with the major failing every attempt towards 1.14 handle near 1.1390 region.

EUR/USD struggles below 1.1400

The EUR/USD pair trades 0.23% higher at 1.1387, fighting hard to extend beyond 1.14 handle. The major retraced from fresh monthly highs recorded at 1.1411 in the early European morning and now hovers 1.1390 area, with the bulls hit badly by the dismal German ZEW data.

The headline ZEW confidence index came in at 1.9 points in October, sharply lower from last month's 12.1 points, missing a 6.8 reading expected. The sharp deceleration was attributed to the last month’s Volkswagen emission-scandal and external headwinds.

The main currency pair remains supported, despite the weak data, as the European stocks continue to extend lower amid risk-aversion triggered by renewed China slowdown concerns. The pan European benchmark, the Euro Stoxx 50 sinks -1.23% while the DAX loses -1.20% so far.

The latest China trade data released in the Asian session showed that the country’s exports slipped 1.1% in September from a year earlier, while imports plunged 17.7%.

EUR/USD Technical Levels

The pair holds above all its daily major moving averages while the RSI remains above the mid-lines, pointing to further advances. Thus, to the upside, the major faces immediate resistance at 1.1400/11 (round number & Today’s High), beyond which a test of 1.1442-60 (Sept 17 & 18 Highs) would become imminent. While the immediate support is located at 1.1356 (50-DMA), a breach of the last would expose 1.1300 (psychological levels).

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