EUR/USD: Recovery capped at 1.0575 amid higher T-yields
|The recovery in EUR/USD from near 1.0550 region lost legs at daily highs of 1.0575, with the bears retaining control somewhat amid a rebound in the US treasury yields.
EUR/USD hovers around 5-DMA at 1.0563
The EUR/USD pair erased most recovery gains as the greenback regained bids amid a solid comeback staged by the treasury yields, following Friday’s sell-off induced by Trump’s rhetoric, which offered no clarity on his ‘phenomenal’ tax reforms.
However, the major remains underpinned amid increased uncertainty over the Trump administration’s policies, as markets remain prepared for another disappointing speech by the US President Trump before the Congress scheduled tomorrow.
Also, risk-off market profile amid reports of a new independence Scottish referendum being called in by Nicola Sturgeon and Theresa May, as cited by the Times, keeps the funding currency EUR buoyed.
Attention turns towards the developments surrounding the French election and Spanish inflation figures due later in Europe for fresh impetus on the Euro. While the USD may get influenced by the upcoming US datasets (durable goods and pending home sales) and FOMC member Kaplan’s speech.
EUR/USD Technical Levels
In terms of technicals, the pair finds the immediate resistance 1.0620 (weekly highs). A break beyond the last, doors will open for a test of 1.0636/39 (50 & 100-DMA) and from there to 1.0682 (Feb 16 high). On the flip side, the immediate support is placed at 1.0520 (Jan 6 low) below which 1.0500 (psychological levels) and 1.0478 (Jan 5 low) could be tested.
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