EUR/USD clinches highs near 1.2450, FOMC eyed

• Spot moves higher on USD-selling.
• Trump’s SOTU speech failed to help the buck.
• US ADP, FOMC decision on top of the agenda today.

The demand for the European currency resumed its upside momentum after EUR/USD briefly tested lows in the 1.2380 area on Tuesday, managing to regain the 1.2400 handle and advance to current daily peaks in the 1.2445/50 band.

EUR/USD focused on US data

The pair is up for the second session in a row following a resumption of the negative sentiment around the greenback. President Trump’s first SOTU speech late on Tuesday did nothing to help the buck, which has dropped once again below the key 89.00 support.

EUR also found some support following yesterday’s comments by ECB’s K.Knot, saying that the current bond-buying programme could end with a ‘short taper’ instead of a sudden stop.

Looking ahead, advanced inflation figures in the euro area during January will be the salient event during the European morning, whereas the ADP report will stay on top of the US agenda ahead of the FOMC meeting, expected later in the NA session.

EUR/USD levels to watch

At the moment, the pair is gaining 0.31% at 1.2442 and a breakout of 1.2495 (high Jan.26) would target 1.2537 (2018 high Jan.25) en route to 1.2571 (high Dec.16 2014). On the flip side, the next support aligns at 1.2348 (10-day sma) followed by 1.2336 (low Jan.30) and finally 1.2208 (21-day sma).