The selling pressure around the European currency is now gathering extra pace, forcing EUR/USD to test fresh session lows in the 1.1885/80 band.

EUR/USD weaker on data, Germany

Spot remains on the defensive so far at the beginning of the week, testing lows near 1.1880 and it has beginning to erode the critical 5-month support line, today around 1.1875.

In addition, poor results from the German IFO for the month of September also added to the bearish note surrounding EUR on Monday.

It is worth mentioning that EUR opened the week with a gap lower following the German elections, where Merkel’s CDU/CSU retained power, although the far-right AfD reached almost 13% of vote intention, eclipsing the initial optimism. Earlier in the session, CSU’s Seehofer argued the party will stay partner with CDU.

On the data front, ECB-speak will include members Draghi, Coeure, Constancio and Mersch), while the Chicago Fed index and speeches by NY Fed W.Dudley (permanent voter, dovish) and Chicago Fed C.Evans (voter, dovish) are also due across the pond.

EUR/USD levels to watch

At the moment, the pair is losing 0.60% at 1.1885 and a breakdown of 1.1862 (low Sep.20) would target 1.1837 (low Sep.14) en route to 1.1793 (55-day sma). On the upside, the initial hurdle emerges at 1.2006 (high Sep.22) followed by 1.2033 (high Sep.20) and finally 1.2069 (high Aug.29).