EUR/USD trades narrowly and remains little changed on the day
The pair is trading in more neutral territory as price is keeping below the 100-hour MA (red line) @ 1.0919 but above the 200-hour MA (blue line) @ 1.0868.
There is some near-term support from bids around the 1.0900 handle but also from the near-term trendline support, which is coming into play currently.
Although risk tones are more upbeat, the dollar isn’t exactly falling off too much to start the day while the euro side of the equation is fixated on the German court ruling later.
The German constitutional court is set to rule on the legality of the ECB QE program but is expected to side with the central bank despite all the commotion over the past few years.
The risk here is that it could present legal complications since this will at least cover the Bundesbank but I would say any reaction in the euro will be purely sentimental.
The issue here is that if QE is already slapped with legal complications, that makes the recently announced PEPP almost surely to face a similar fate since it has less strings attached.
If we do see a surprise decision and the euro falls because of that, support from the 200-hour MA and the 50.0 retracement level @ 1.0868-72 will be the key levels to watch.
Break below that and the near-term bias in the pair turns more bearish. Hold above and the bias remains more neutral, with buyers needing to break above the 100-hour MA @ 1.0919 to establish a more bullish near-term bias in the sessions ahead.