EURUSD Rally Gathering Pace

EUR On the UpThe dominant theme across markets as we kick of the new week Is the ongoing correction lower in USD. With the greenback under heavy selling pressure, we’re seeing a cross-asset recovery underway. In the FX space, high yielders such as AUD and NZD has been the standout winner. However, currencies such as EUR are also enjoying solid gains on Monday. EURUSD broke out above the 1.0785 level last week and now looks to be building fresh momentum for a continued move higher.EZ PMIs DueGiven that ECB tightening expectations have faded recently, in line with the continued drop off in inflation, the current move looks to be mainly USD driven. Recession risks have been back in focus for the eurozone recently and the latest set of PMI readings due late this week hold downside risks for EUR, given the negative readings we’ve had in recent months. However, if those readings beat expectations, this should feed into the current EURUSD rally, helping lift the pair higher still.FOMC MinutesAhead of those readings, the FOMC minutes on Wednesday will be the big focus for traders. Given the recent CPI release, the minutes will likely have lost a little impact. However, with USD under heavy pressure, if the minutes appear to have a dovish skew this should reinforce the current dynamic, sending EURUSD higher near-term.Technical ViewsEURUSDThe breakout above the 1.0785 level has seen the market trading up to test interim resistance at the 1.0937 level. With momentum studies bullish, the focus is on a continued move higher while the market holds above the 1.0785 level with 1.1126 the longer-term target for bulls.