EUR/USD moves higher to 1.2280, session tops

• The pair gathered extra traction on increasing USD-selling.
• USD plummets to fresh lows in the 90.20 region tracked by DXY.
• Rising US-China concerns revived the risk-off trade, hurting the buck.

EUR/USD has found fresh buying interest and is now flirting with daily highs in the 1.2270/80 band.

EUR/USD bid on risk aversion

The selling pressure around the greenback is now intensifying after President Trump’s Advisor L.Kudlow stressed there is no timetable regarding US-China tarde negotiations, adding at the same time that the Chinese reaction to US measures has been so far unsatisfactory.

Kudlow’s comments triggered a bout of risk aversion that accelerated the inflows into the safe haven assets, particularly the Japanese Yen, motivating a quick drop in USD/JPY with the resulting USD sell off.

In addition, recent Non-farm payrolls seem to have given extra oxygen to the view of a more gradual interest rate path by the Federal Reserve in the next months (at least not as aggressive as previously estimated by market participants), all weighing down on the buck.

Despite the ongoing squeeze higher, spot keeps the bearish note intact this week, retreating for the second week in a row to levels last seen in late February. The down move motivates once again the 1.2200 handle and the 1.2165/55 band to emerge on the investors’ horizon.

EUR/USD levels to consider

At the moment, the pair is advancing 0.20% at 1.2266 and a break above 1.2312 (10-day sma) would target 1.22346 (high Apr.2) en route to 1.2478 (high Mar.27). On the other hand, immediate support aligns at 1.2216 (low Apr.6) seconded by 1.2206 (low Feb.9) and then 1.2165 (low Jan.18).