EUR/USD braces for fresh multi-year low around 0.9600, ECB’s Lagarde, Fed’s Powell eyed


  • EUR/USD teases two-decade low marked earlier in the week, pressured of late.
  • Multiple leaks in Russia’s Nord Stream gas pipeline renewed fears of Europe energy crisis.
  • Firmer US data, hawkish Fedspeak joined upbeat yields to weigh on prices.
  • Second-tier economics to decorate calendar but risk catalysts are the key, bears may cheer hawkish comments from Powell.

EUR/USD holds lower grounds around the yearly bottom marked on Monday, despite picking up bids to 0.9600 during Wednesday’s Asian session, as risk-aversion intensifies. Also exerting downside pressure on the major currency pair could be the fears of more pain in terms of the energy supplies to the old continent, as well as the firmer US data.

Multiple leaks in Russia’s gas pipeline in the Baltic Sea raise woes that the Eurozone’s energy supply problems are likely to be permanent. The same intensify fears of recession inside the bloc, especially amid an absence of impressive data and inflation fears.

With this, the hawkish comments from the European Central Bank (ECB) policymakers failed to impress EUR/USD bulls. ECB Vice President Luis de Guindos said on Tuesday that they will continue to raise rates over the coming months and added that the number and size of the hikes will be determined by the data, as reported by Reuters. "We are facing an overlapped succession of shocks that have changed the context in a significant way," ECB Governing Council member Mario Centeno said and noted that the interest rate increase cycle will continue.

On the other hand, firmer US Durable Goods Orders and CB Consumer Confidence data joined hawkish Fedspeak to impress the greenback buyers. US Durable Goods Orders declined by 0.2% in August versus the market forecasts of -0.4% and the revised down prior reading of -0.1%. The Nondefense Capital Goods Orders ex Aircraft, however, improved by 1.3% during the stated period compared to 0.2% expected and 0.3% previous readouts. Additionally, US CB Consumer Confidence improved for the second consecutive month to 108.00 for September versus 104.5 expected and 103.20 prior.

"At some point, it will be appropriate to slow the pace of rate increases and hold rates for a while to assess the impact on the economy," Chicago Fed President Charles Evans said on Tuesday, as reported by Reuters. St. Louis Federal Reserve Bank President James Bullard said on Tuesday that they have a serious inflation problem in the US, as reported by Reuters. "More rate rises to come in future meetings." Minneapolis Fed President Neel Kashkari said the central bank is moving "very aggressively," and there is a high risk of "overdoing it." 

It’s worth noting that the rally in the global bond yields, led by the UK’s gilt, joined downbeat equities to add strength to the bearish bias for the EUR/USD pair.

Moving on, a lack of major data/events could keep the EUR/USD weakness continued amid the prevailing fears for the bloc and the market’s rush for risk safety. However, speeches from ECB President Christine Lagarde and Fed Chair Jerome Powell may entertain the pair buyers if they speak about matters relating to the monetary policy.

Technical analysis

EUR/USD sellers poke the year 2001 peak surrounding 0.9590 to aim for the support line of a six-month-old bearish channel, at 0.9475 by the press time.

Additional important levels

Overview
Today last price 0.9596
Today Daily Change -0.0014
Today Daily Change % -0.15%
Today daily open 0.961
 
Trends
Daily SMA20 0.9945
Daily SMA50 1.0069
Daily SMA100 1.0274
Daily SMA200 1.0687
 
Levels
Previous Daily High 0.971
Previous Daily Low 0.9553
Previous Weekly High 1.0051
Previous Weekly Low 0.9668
Previous Monthly High 1.0369
Previous Monthly Low 0.9901
Daily Fibonacci 38.2% 0.9613
Daily Fibonacci 61.8% 0.965
Daily Pivot Point S1 0.9539
Daily Pivot Point S2 0.9467
Daily Pivot Point S3 0.9382
Daily Pivot Point R1 0.9695
Daily Pivot Point R2 0.9781
Daily Pivot Point R3 0.9852

 

 

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 Join Telegram

Recommended content


Recommended content

Editors’ Picks

EUR/USD falls below 1.0500 after US NFP data

EUR/USD falls below 1.0500 after US NFP data

EUR/USD dropped below 1.0450 but managed to stage a modest rebound. The US Dollar preserves its strength against its rivals and doesn't allow the pair to gain traction after the data from the US showed that Nonfarm Payrolls rose by 263,000 in November.

EUR/USD News

GBP/USD turns south on upbeat US jobs report, trades below 1.2200

GBP/USD turns south on upbeat US jobs report, trades below 1.2200

GBP/USD lost nearly 100 pips with the immediate reaction to the upbeat November jobs report from the US and broke below 1.2200. The US Dollar Index clings to strong daily gains above 105.00 after the data showed that Nonfarm Payrolls rose by 263,000.

GBPUSD News

Gold retreats below $1,790 as US yields surge on US NFP

Gold retreats below $1,790 as US yields surge on US NFP

Gold price turned south and dropped below $1,790 in the early American session. The benchmark 10-year US Treasury bond yield is up more than 2% on the day near 3.6% after the bigger-than-expected November job growth, weighing heavily on XAU/USD.

Gold News

FTX exchange collapse, loss of $3.1 billion could have been avoided on one condition

FTX exchange collapse, loss of $3.1 billion could have been avoided on one condition

FTX exchange, founded by Samuel Bankman-Fried (SBF), has consistently made headlines over the past month for its liquidity crisis and triggering a collapse in the crypto ecosystem.

Read more

AMC advances more than 3% in premarket day after being halted

AMC advances more than 3% in premarket day after being halted

AMC stock is up 3.4% in Friday's premarket just a day after authorities halted trading due to unusual volatility. Thursday saw options volume three times higher than the 20-day average.

Read more

Forex MAJORS

Cryptocurrencies

Signatures