EUR/USD bounces off multi-month lows, upsides seems limited


  • A modest USD pullback assisted EUR/USD to stage a modest bounce from multi-month lows.
  • Rising bets for an earlier Fed taper, rallying US bond yields should act as a tailwind for the USD.
  • COVID-19 jitters might further underpin the safe-haven USD and cap the upside for the major.

The EUR/USD pair managed to rebound around 20-25 pips from four-month lows, albeit lacked any follow-through buying. The pair was last seen trading with modest gains, around the 1.1765 region heading into the European session.

The pair found some support near the 1.1740 region and for now, seems to have stalled its post-NFP downfall to the lowest level since April 5. The uptick was exclusively sponsored by a modest US dollar pullback from two-week tops, though any meaningful recovery remains elusive.

Friday's blockbuster US jobs report fueled speculations that the Fed could start tapering its asset purchases later this year and forced investors to bring forward the likely timing for the Fed policy tightening. This was evident from the ongoing move up in the US Treasury bond yields.

In fact, the yield on the benchmark 10-year US government bond jumped back above the 1.30% threshold. Apart from this, concerns about the economic fallout from the fast-spreading Delta variant of the coronavirus might act as a tailwind for the USD and cap the upside for the EUR/USD pair.

Hence, the attempted recovery could be solely attributed to some intraday short-covering move, which runs the risk of fizzling out rather quickly. In the absence of any major market-moving economic releases on Monday, the EUR/USD pair remains at the mercy of the USD price dynamics.

Later during the early North American session, traders might take cues from scheduled speeches by Atlanta Fed President Raphael Bostic and Richmond Fed President Thomas Barkin. This, along with the broader market risk sentiment, might produce some trading opportunities around the EUR/USD pair.

Technical levels to watch

EUR/USD

Overview
Today last price 1.1764
Today Daily Change 0.0001
Today Daily Change % 0.01
Today daily open 1.1763
 
Trends
Daily SMA20 1.182
Daily SMA50 1.1929
Daily SMA100 1.1968
Daily SMA200 1.2009
 
Levels
Previous Daily High 1.1836
Previous Daily Low 1.1755
Previous Weekly High 1.19
Previous Weekly Low 1.1755
Previous Monthly High 1.1909
Previous Monthly Low 1.1752
Daily Fibonacci 38.2% 1.1785
Daily Fibonacci 61.8% 1.1805
Daily Pivot Point S1 1.1733
Daily Pivot Point S2 1.1703
Daily Pivot Point S3 1.1652
Daily Pivot Point R1 1.1814
Daily Pivot Point R2 1.1865
Daily Pivot Point R3 1.1895

 

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD drops towards 1.1300 on dovish ECB headlines

EUR/USD is extending the drop towards 1.1300 after the ECB is debating over a potential increase in the APP at its meeting next week. The US dollar rebounds amid a cautious mood. Omicron, US-China woes keep investors on the edge.

EUR/USD News

GBP/USD battles 1.3200 amid Omicron jitters, USD rebound

GBP/USD is trading flat around 1.3200, struggling to capitalize on the overnight goodish rebound from a one-year low. Fresh COVID-19 jitters pushed back BoE rate hike expectations and undermined the pound. Resurgent USD demand further stalled aggressive bullish bets.

GBP/USD News

Gold eases towards $1,780 on resurgent USD demand

Gold remains on the back foot below $1,790 amid broad US dollar reboud. Market sentiment dwindles as virus-linked news battles geopolitical fears, Fed rate hike concerns. Friday’s US CPI becomes crucial as inflation expectations improve.

Gold News

Analysts believe Ripple could beat SEC lawsuit on one condition

Experts are weighing in on the possible closure of the payments giant's lawsuit with the SEC. Analysts predict that the payment giant's win in the SEC vs. Ripple case could push XRP to a new high.

Read more

Cyber Monday 2021 Discounts!

Glued to your trading screen on Cyber Monday? Upgrade your skills by signing up for FXStreet’s Premium service, offered at a discount of up to 50%. Fellow traders have already taken advantage of Black Friday profits. What about you? 

Subscribe now!

Forex MAJORS

Cryptocurrencies

Signatures