EUR/USD Forecast: Euro set to head towards $1.1900
|The EUR/USD has experienced an interesting short-term shock with the broad US Dollar selloff backed by rumors of China halting or halving the US Treasuries buys. The EUR/USD jumped as high as $1.2020 midday on Wednesday but retreated back to where it had been before the China news at $1.1940 by Thursday.
On a relatively data weak day with the lagging Eurozone industrial production data for the month of November due and the ECB December meeting minutes, it is the sentiment and the technical factors are likely to drive the market.
Looking at the short-term chart, the prospects of falling towards $1.1900 immediate target are in place. Targeting cyclical lows of $1.1910 will test the ability of the market to see the level from Tuesday. The $1.1900 level is also an important technical barrier as it represents the 50% Fibonacci retracement line of recent upmove from $1.11717 to $1.2092.
The bearish mood on the FX market is underlined by the US Treasury yield development with the 10-year yields falling 1 basis point to 2.539%.
Technical oscillators on 15 minutes chart are pointing downward and the bearish crossover of 50-period and 100-period moving average indicate a potential for the move towards $1.1900.
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