EUR/USD is threatening 1.1375/1.1425 resistance as factors outside the EU are driving the pair higher.
Indeed, with its sudden upward push, the Euro has ignored the big downside miss to German January IFO, which bolsters concerns slow EU growth will persist, and corrects Draghi induced losses.
Yesterday's comments by U.S. Treasury's Mnuchin saying yuan currency issues will be discussed at next week's trade talks are still impacting the market and has driven the dollar lower against most major and EM currencies.
USD/CNH has fallen toward 6.7575 and the ripple effects helped rally EUR/USD toward the daily cloud base and converging 10- and 55-DMAs.
A Dow Jones report stating the Fed could maintain a larger than expected portfolio has helped risk-sensitive assets gain and add to dollar pressure.
Additionally, reports that the DUP is ready to support May's Brexit plan have lifted GBP/USD and the knock-on effects benefit EUR/USD.
Thus, this sudden flood of factors is trumping the risks facing EUR/USD, making a 1.1425 break likely.
The 200-DMA and January's high can then be in play but gains beyond these levels are unlikely as slower EU growth and upcoming elections loom.
chart: Click here