EUR/USD stalls overnight tepid recovery move from 7-week lows

The EUR/USD pair trimmed some of its early strong gains and has now retreated around 20-pips from session tops. 

The pair stalled its overnight recovery move from 7-week lows and met with some fresh supply near 1.1780 level, despite a mildly softer tone surrounding the US Dollar. The recent USD rally paused on Wednesday amid market speculations that the US President Donald Trump's choice for the next Fed Chair might be less hawkish than previously thought. 

The pair, however, seemed lacking any strong buying interest as investors refrained from placing aggressive bets ahead of Friday’s keenly watched US monthly jobs data. The key NFP print would be looked for reinforcement that the Fed would move towards raising interest rates in December, for the third time this year, and eventually determine the next leg of directional move for the major.

Meanwhile, the release of final Euro-zone PMIs passed unnoticed as focus remains on today's US economic docket, featuring the release of ADP report and ISM non-manufacturing PMI. Later during the day, speeches by the ECB President Mario Draghi and the Fed Chair Janet Yellen might trigger a bout of volatility and provide impetus for short-term traders. 

Technical levels to watch

A follow through retracement below mid-1.1700s is likely to find support near 1.1730 level, which if broken would turn the pair vulnerable to break below the 1.1700 handle and head towards testing its next support near 1.1675 area. 

On the upside, any up-move beyond 1.1780-85 immediate hurdle might confront some supply near the 1.1800 handle, above which the pair is likely to move towards retesting an important support break-point, now turned strong resistance, at 50-day SMA near the 1.1845 region.