EUR/USD: under pressure, near key support

Valeria Bednarik FXStreet

EUR/USD Current price: 1.1755

The common currency opened the week under pressure, with the EUR/USD pair down to 1.1729 so far today, amid the result of the referendum on Catalan independence in Spain. The central government called it illegal, but the Catalan autonomous government called that 90% of the voters chose to become independent. Following German's election outcome, fears of excisions within the EU are again sounding loud, and being the main reason of the EUR's latest slide. Also, news over the weekend indicated that US President Trump interviewed Fed´s Jerome Powell and Kevin Warsh as possible candidates to replace Janet Yellen as head of the FOMC, when her mandate ends later this year. Given that both candidates are seen as hawkish towards rate hikes, the greenback keeps finding support across the board.

In the data front, Markit released the final September manufacturing PMIs for the whole EU, which came in barely changed from preliminary estimates, indicating that economic growth in the region keeps advancing at a solid pace. The pair trades around 1.1755 ahead of the US opening, bearish short term, as in the 4 hours chart, the price is developing below its 20 SMA, also below the 23.6% retracement of the previous week decline, while the Momentum indicator enters negative territory with a strong downward slope, and the RSI hovers near oversold readings. The pair bottomed last week at 1.1716, with approaches to the 1.1720 region attracting short term buying interest, meaning that a break below this last should open doors for a bearish extension towards 1.1661, August monthly low.

Support levels: 1.1720 1.1695 1.1660

Resistance levels: 1.1810 1.1850 1.1895

View Live Chart for the EUR/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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