EUR/USD collapses to 3-month lows… 1.20 back on the radar?

  • The pair has quickly eroded the post-ECB up tick to 1.2200.
  • Spot tumbles to 1.2120, the lowest level since mid-January.
  • USD finds traction on Kudlow/Mnuchin trip to China.

After testing the 1.2200 neighbourhood, EUR/USD quickly plummeted to the area of 1.2120/15, or fresh multi-month lows.

EUR/USD failed just ahead of 1.2200

The pair’s earlier spike to fresh daily highs near 1.2200 the figure was ephemeral, as sellers rapidly stepped in following news that Trump’s Advisor Kudlow and Treasury Secretary Mnuchin are going to China. Market participants considered the news as one step closer to a favourable outcome from the so-much-talked US-China potential trade war, rendering in extra support to the buck.

In fact, the greenback found strong support in the 91.00 area after yields of the key US 10-year reference retreated from session tops to the 3.0% zone, where some decent contention also emerged.

In addition auspicious results from the US docket have also lent wings to the greenback, collaborating with the recovery albeit on a lesser degree.

It is worth recalling that EUR meet a wave of fresh buying orders after President Draghi downplayed the recent weakness in some indicators in the euro area, although the Council is expected to keep monitoring these developments looking for permanent or transitory factors behind the loss of momentum.

Furthermore, spot has broken below the multi-month 1.2155/1.2555 range and attention should now be on the likelihood of a follow up of the down move, which could bring back the 1.20 area into the investors’ radar.

EUR/USD levels to watch

At the moment, the pair is losing 0.35% at 1.2118 facing the next support at 1.2090 (high Jan.4) seconded by 1.2008 (200-day sma) and then 1.1916 (2018 low Jan.19). On the flip side, a break above 1.2210 (high Apr.26) would target 1.2298 (21-day sma) en route to 1.2414 (high Apr.17).

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.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD recovers post-Fed losses, awaits data

EUR/USD is trading close to 1.1050, up from the lows it fell to on Wednesday after the Fed cut rates but signaled no new moves are imminent. Markets are digesting the decision and eyeing several US figures.


GBP/USD stabilizes below 1.25 after mixed retail sales, ahead of the BOE

GBP/USD is trading below 1.25, consolidating its losses after the US Fed cut rates as expected and indicated a pause. UK retail sales missed expectations but saw upward revisions. The BOE is set to leave rates unchanged. 


USD/JPY keeps losses below 108.00 as BOJ disappoints the doves

USD/JPY keeps the losses below 108.00, as the Japanese Yen remains on the front foot in reaction to the Bank of Japan's (BOJ) status-quo that came in as a disappointment for the doves. 


Gold: Indecisive market, focus on today's close

Gold is currently trading at $1,480 per Oz, representing 0.21% drop on the day. On Wednesday, the yellow metal witnessed two-way business before ending the day with moderate losses at $1,494.

Gold News

Forex Today: Dollar surrenders post-Fed gains, Aussie and Bitcoin tumble, BOE in focus

The US dollar is off its highs against major pairs as markets digest the Federal Reserve's decision. The Fed cut rates by 25 basis points as expected and the dot-plot signaled no further cuts this year or the next.

Read more