FxWirePro: EUR/ NZD consolidating around 1.9855, room for further gains

• EUR/NZD consolidated around 1.9855 on Monday as markets kept a close watch on Middle East developments and the inflationary impact of surging oil prices.

• Iran’s armed forces launched airstrikes on Israel on Sunday night in retaliation for Israeli strikes on Beirut’s Dahiyeh suburb in Lebanon, following earlier warnings that it would respond if Israeli raids continued.

• Crude oil rose up to 5% on renewed Middle East strikes but later eased to about 1% after Trump urged both sides to “stop shooting.”

• Israeli Prime Minister Benjamin Netanyahu acknowledged the halt in fighting with Iran on Monday, but warned that Israel would respond “with force” if attacks resume.

•Investors are focused on Thursday’s ECB meeting, where a 25 bps hike is widely expected, as Middle East tensions threaten to lift energy prices and add to inflation pressures in Europe.

•Given weaker eurozone conditions, the ECB faces a policy dilemma between price stability and economic growth.

• Immediate resistance is located at  1. 9980 (50%fib), any close above will push the pair towards 2.0067(higher BB)

• Immediate support is seen at 1.9774 (SMA 20) and break below could take the pair towards 1.9682(61.8%fib).

 Recommendation: Good to buy around 1.9840 with stop loss of 1.9750 and target price of 1.9900