EUR/USD extends gains to the 1.1770 area as US dollar retreats

• Euro rebounds from one-week lows versus the dollar to 1.1770.
• EUR/USD finds support around the 20-day moving average.  

The EUR/USD pair reached a fresh daily high at 1.1770 during the American session amid a decline of the US dollar across the board. The greenback is pulling back favouring a move higher in the pair. The DXY drops 0.22% and trades under 93.30, trimming weekly gains. 

Data released on Wednesday in the US, showed the Producer Price Index (PPI) rose 0.4% in September, above the 0.2% of market consensus. The numbers have no impact on the market. On Thursday, the weekly jobless claims report is due.

Equity prices in Wall Street are mixed on Thursday, following earing report from top financial institutions. Traders await a resolution regarding fiscal stimulus. The question is when and how, if before or after the election. A resolution in the short-term could boost risk appetite, weakening the greenback. 

Levels to watch

Earlier today, EUR/USD bottomed at 1.1719, the lowest since October 5. The euro then rebounded rising back above the 20-day moving average that stands at 1.1740. At the moment, it trades at 1.1765, up 20 pips for the day. A daily close clearly below that line would suggest more weakness ahead. On the upside, the key resistance ahead is the 1.1800 followed by the October high at 1.1830.