EUR/USD remains depressed near 1.1060, FOMC eyed
|- EUR/USD stays under pressure in 2-day lows.
- DXY raises to weekly highs beyond the 98.00 mark.
- FOMC minutes coming up next in the NA session.
The bearish note around the shared currency remains unchanged towards the end of the European trading hours on Wednesday, dragging EUR/USD to new lows in the vicinity of 1.1050.
EUR/USD looks to trade, FOMC
The euro and the rest of the riskier assets came under extra downside pressure on Wednesday following the resurgence of US-China trade concerns as well as increasing jitters stemming from the unabated social unrest in Hong Kong. In fact, the relationship between the US and China carries the potential to deteriorate even further after the US Senate unanimously passed the Hong Kong Humans Right and Democracy Act bill on Tuesday.
Also weighing on spot, yields of the German Bund keep navigating in the area of 3-week lows in the -0.387 region, sponsoring a wider spread vs. their American peers.
On the docket, another poor print from the German Producer Prices in October is also undermining the sentient in the shared currency. Across the pond, the most relevant event will be the publication of the FOMC minutes later in the European evening.
What to look for around EUR
Spot met strong resistance in the 1.1080/90 band for the time being while it keeps looking to USD-dynamics and headlines from the US-China trade front for direction. On the macro view, the outlook in Euroland remains fragile and does nothing but justify the ‘looser for longer’ monetary stance by the ECB and the bearish view on the single currency in the medium term at least. In this regard, all the looks will be upon the release of November’s preliminary PMIs later in the week.
EUR/USD levels to watch
At the moment, the pair is losing 0.15% at 1.1062 and a breach of 1.0989 (monthly low Nov.14) would target 1.0925 (low Sep.3) en route to 1.0879 (2019 low Oct.1). On the upside, the initial barrier emerges at 1.1089 (high Nov.18) followed by 1.1174 (200-day SMA) and finally 1.1179 (monthly high Oct.21).
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