EUR/USD: 1.1800 – a tough nut to crack? Eyes on US tax vote

DXY catches a fresh bid on White House headlines.
Risk-recovery gathers pace in Asia.
All eyes on the US tax reform vote.

Dhwani Mehta FXStreet

The EUR/USD pair traded weaker below 1.18 handle in the Asian trades, as the US dollar remained broadly supported ahead of the key vote on the US tax reform plan due later on Thursday.

EUR/USD trades below 100-DMA at 1.1796

The spot extended its sharp reversal from four-week tops of 1.1860 and went on to hit daily lows at 1.1769 in early trades, now consolidating the downside amid a pick-up in buying interest seen around the US dollar across its main peers, in response to the comments from the White House reporters, citing that the GOP leaders are confident they have the votes to pass the tax bill today.

More so, yesterday’s uptick seen in the US core CPI figures also kept the sentiment around the US dollar somewhat buoyed, while a recovery in risk sentiment on the back of the rebound in the global equities and Treasury yields further added to the weight on the funding currency Euro.

Later today, the pair will get influenced by the broader market sentiment and USD price-action ahead of the US jobless claims, industrial production, and tax vote.

EUR/USD Technical Levels

Valeria Bednarik, Chief Analyst at FXStreet, noted: “In the 4 hours chart, technical indicators are correcting extreme overbought conditions, but still far from suggesting the bullish run is over. In the same chart, the 20 SMA heads sharply higher, now about to surpass the 200 SMA after already breaking above the 100 SMA. A steeper correction could take place on a break below 1.1745, the 38.2% retracement of the same rally, while to the upside, a critical mid-term resistance comes at 1.1890. Support levels: 1.1790 1.1745 1.1700 Resistance levels: 1.1860 1.1890 1.1930.”

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

EUR/USD looks to regain the 200-day SMA

EUR/USD regains some balance and trade just above 1.1600 the figure ahead of the opening bell in Asia. The pair initially dipped to the 1.1530 zone for the first time since November, always following the stronger US Dollar and the marked flight-to-safety in the context of the ongoing Middle East crisis

GBP/USD attacks 1.3300, refreshing three-month lows

GBP/USD is deep in the red near 1.3300, accelerating its downside to renew three-month lows in European trading on Tuesday. The ongoing escalation in the Iran war, combined with rising Oil prices, weighs negatively on the higher-yielding Pound Sterling as the US Dollar capitalizes on increased haven demand.

Gold bounces off lows, back above $5,100

Gold remains on the defensive, eroding part of the recent multi-day advance and managing to trade back above the $5,100 mark per troy ounce on Tuesday. The precious metal initially dropped just below the critical $5,000 threshold on the back of the persistent strength of the Greenback, higher US Treasury yields across the curve and investors' repricing of Fed rate cuts.