EUR/USD rebounds modestly, closes in on 1.1800

• EUR/USD looks to snap a four-day losing streak.
• US Dollar Index broke below 93.00 in the American session.
• Risk-positive market environment is making it difficult for USD to find demand.

After spending the majority of the day in a relatively tight range above 1.1750, the EUR/USD pair gained traction during the American trading hours and was last seen rising 0.15% on the day at 1.1796.

DXY reverses direction as Wall Street rally continues

In the absence of high-tier macroeconomic data releases and fundamental developments, the risk perception continues to impact the USD's market valuation. Earlier in the day, the US Dollar Index (DXY) reached its highest level since early April at 93.19 and didn't allow EUR/USD to stage a rebound.

With Wall Street's main indexes building on Tuesday's impressive upsurge and opening in the positive territory on Wednesday, the greenback lost its strength. Reflecting the renewed USD weakness, the DXY is down 0.1% on the day at 92.86. 

On Thursday, the European Central Bank (ECB) will announce its Interest Rate Decision and release the Monetary Policy Decision.

Previewing this event, "the ECB’s latest announcement – that purchases under the Pandemic Emergency Purchase Programme (PEPP) over the coming quarter will continue to be conducted at a significantly higher pace than during the first months of this year – reinforces our view that the ECB will remain highly accommodative for longer," said Lee Sue Ann, Economist at UOB Group.

European Central Bank Preview: Fresh forward guidance, old fears.

Technical levels to watch for