The Euro maintains its bullish momentum against the US Dollar, prompting EUR/USD to build on Thursday’s gains just beyond 1.0900 at the end of the week.

On the other hand, the Greenback appears mildly offered around 103.70 according to the USD Index (DXY), a region also coincident with the critical 200-day SMA.

In the meantime, volatility is expected to remain at low levels following the US Thanksgiving Day holiday on Thursday and Friday’s shortened trading session.

The US Dollar has managed to rebound earlier in the week despite the prevailing expectation of a potential interest rate cut by the Federal Reserve (Fed) at some point in the spring of 2024. This view remains well supported by persistent disinflationary pressures and the ongoing easing of the labour market.

On the European docket, final GDP Growth Rate figures showed the German economy shrank 0.1% QoQ and 0.4% over the last twelve months. Still in Germany, the Business Climate index improved to 87.3 in November, according to the IFO institute.

Shifting the focus to the European Central Bank (ECB), its President Christine Lagarde stated that progress was being observed in terms of inflation. She mentioned that significant actions had already been taken regarding interest rates and that the situation could now be monitored. Still around the bank, Vice-President Luis De Guindos is due to speak later in the session.

Across the pond, preliminary Manufacturing and Services PMIs will be the sole release on Friday.

Daily digest market movers: Euro extends the recovery beyond 1.0900

• The EUR adds to recent gains against the USD.
• US and German yields edge higher early on Friday.
• Investors are still assessing the Fed's rate reduction in 2024.
• Markets believe the ECB will keep its policy unchanged until early next year.
• ECB's Lagarde stressed that the battle to tackle inflation is far from over.
• Business Climate in Germany improves a tad in November.
• BoE’s Huw Pill argued that economic activity and job growth are softening.

Technical Analysis: Euro's longer-term target emerges at 1.1000

EUR/USD maintains the slightly bid bias above the 1.0900 hurdle at the end of the week.

The November high of 1.0965 (November 21) represents the immediate target for bulls ahead of the key 1.1000 threshold. Further north, EUR/USD may encounter resistance at the August top of 1.1064 (August 10) and another weekly peak of 1.1149 (July 27), both preceding the 2023 high of 1.1275 (July 18).

Meanwhile, any corrective declines should find first support at the major 200-day Simple Moving Average (SMA) at 1.0809, followed by the temporary 55-day SMA at 1.0658. The weekly low of 1.0495 (October 13) aligns just below here, before the 2023 low of 1.0448 (October 3).

Overall, the pair's prospects should remain positive as long as it remains above the 200-day SMA.

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