EUR/USD accelerates bullish momentum further beyond 1.20 handle

   •  ECB minutes triggers the initial leg of upsurge.
   •  Dismal US PPI print provides an additional boost.
   •  Short-covering might continue driving it higher.

The EUR/USD pair built on its bullish momentum further beyond the key 1.20 psychological mark and jumped to three-day highs during the early NA session.

After an initial dip to the 1.1930 region, bulls regained control during the mid-European session and lifted the pair sharply higher after the ECB minutes revealed that a possible shift in guidance could come in early 2018. 

The momentum got an additional boost following the release of US economic data, which fell short of consensus estimates and exerted some fresh downward pressure on the greenback. 

The US Dollar continued losing ground through the early NA session after data released from the US showed producer prices plunged in December, missing expectations dramatically and deflating the most since August 2016. 

   •  US: PPI for final demand falls 0.1% in December; services decrease 0.2%, goods unchanged

Meanwhile, a goodish pickup in the US Treasury bond yields did little to lend any support to the buck, with a fresh bout of short-covering now seems to be one of the key factors driving the pair to the 1.2035-40 region.

Technical levels to watch

Immediate resistance is now pegged near 1.2065-70 zone, above which the pair is likely to make a fresh attempt to clear 2017 yearly highs resistance around the 1.2090 region and aim towards testing its next major hurdle near the 1.2165 region.

On the flip side, 1.2015 level, closely followed by the 1.20 round figure mark now seems to protect the immediate downside, which if broken might accelerate the slide back towards 1.1930 horizontal support en-route the 1.1900 handle.