The EUR/USD trended higher from the middle of May when it was trading at 1.0775 until June 10 when it topped out at 1.1422.
Over the past 5 trading days it has consolidated between 1.1200-1.1400 in a choppy fashion.
The move up from mid-May was underpinned by a rise in risk appetite that sent equities and key commodities higher, while the safe-haven USD fell against most currencies. Recent fears of a second wave of the coronavirus have interrupted the gains in risk assets and helped the USD recover some lost ground nP8N2DM02D.
Equity markets are starting to move higher again due to central bank support and rising hopes of medical breakthroughs to temper fears that a second wave of infections will force governments to shut down or delay the reopening of economic activity nL8N2DT3ME.
The EUR/USD consolidation may continue for a while, but it should find strong technical support around 1.1170 where the 21-day moving average converges with the 38.2 Fibonacci retracement of the 1.0766-1.1422 move.
Buying dips with a stop below 1.1150 is the preferred strategy for those believing the rally in risk assets will continue over the medium term.
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