EUR/USD at fresh 5-day lows as greenback advances further

EUR/USD has made fresh daily lows during the American session as the greenback continues to advance versus most competitors after US inflation data came in line with expectations and with higher US yields underpinning the dollar.

US data showed personal income rose 0.4% in December, above the expected 0.3%, while spending advanced 0.4%, matching forecasts. Core PCE inflation also came as expected, up 0.2% and 1.5% MoM and YoY respectively. More relevant, the report also showed that the saving rate fell to a fresh 12-year low. 

In the meantime, the euro was weighed by headlines indicating that ECB's policymakers want a gradual end to QE. 

EUR/USD has steadily declined throughout the day and hit a low of 1.2336 in recent dealings, last seen on Wednesday, Jan 24. The pair is currently trading at the 1.2345 area, recording a 0.62% loss on the day. The dollar is cutting some losses after falling to a 3-year low against the euro last week.

EUR/USD levels to watch

In terms of technical levels, EUR/USD could find next supports at 1.2303 (10-day SMA), 1.2290 (Jan 24 low) and 1.2222 (Jan 23 low). On the other hand, resistances could be faced at 1.2432 (intraday high), 1.2493 (Jan 26 high) and 1.2537 (3-year high scored Jan 25).