EUR/USD comes under pressure below 1.1600, looks to US data

  • EUR/USD starts the week on the back footing.
  • Risk-on sentiment dented after mixed Chinese data.
  • US Industrial Production figures next on tap in the docket.

The European currency remains under pressure and now drags EUR/USD to the 1.1570 region at the beginning of the week.

EUR/USD remains capped above 1.1600

EUR/USD loses ground for the second session in a row on Monday on the back of the continuation of the recovery in the greenback.

In fact, higher US yields sustain the upside move in the buck and encourages the US Dollar Index (DXY) to retake the 94.00 yardstick and above at the beginning of the week. Same path follows yields of the German 10-year Bund, which add to Friday’s advance and reach the -0.12% region.

The pair looks offered against a weak backdrop in the risk complex after Chinese GDP figures showed the economy expanded 4.9% YoY in Q3 and 0.2% inter-quarter, both prints coming in short of estimates. In addition, the jobless rate ticked lower to 4.9%, Retail Sales expanded more than expected 4.4% in the year to September and Industrial Production expanded below forecast at an annualized 3.1% also in September.

Nothing scheduled in the euro calendar on Monday should leave all the attention to the US docket, where Industrial Production figures and the NAHB Index will be in the centre of the debate.

What to look for around EUR

Despite EUR/USD managed to regain the key barrier at 1.1600 the figure and beyond during last week, it was unable to close any session at/above it. As usual in past weeks, dollar dynamics are expected to keep dictating the price action around spot for the time being, where tapering chatter remains well in centre stage. In the meantime, the idea that elevated inflation could last longer coupled with the loss of momentum in the economic recovery in the region, as per some weakness observed in key fundamentals, are seen pouring cold water over investors’ optimism as well as bullish attempts in the European currency.

Key events in the euro area this week: Final EMU CPI (Wednesday) – Preliminary PMIs in the euro zone (Friday).

Eminent issues on the back boiler: Asymmetric economic recovery post-pandemic in the region. Sustainability of the pick-up in inflation figures. Probable political effervescence around the EU Recovery Fund. Investors’ shift to European equities in the wake of the pandemic could lend extra oxygen to the euro. ECB tapering speculations.

EUR/USD levels to watch

So far, spot is losing 0.02% at 1.1592 and faces the next up barrier at 1.1624 (weekly high Oct.14) followed by 1.1640 (weekly high Oct.4) and finally 1.1722 (55-day SMA). On the other hand, a break below 1.1571 (low Oct.18) would target 1.1524 (2021 low Oct.12) en route to 1.1495 (high Mar.9 2020).


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 climbs above 1.1250 as investors eye coronavirus headlines

EUR/USD preserved its recovery momentum early Friday and rose above 1.1250 during the European trading hours. Markets are doubting the Fed's policy tightening prospects as the new coronavirus variant revives concerns over the economic recovery losing steam.


GBP/USD rebounds toward mid-1.3300s on broad dollar weakness

GBP/USD reversed its direction after dipping below 1.3300 earlier in the day and started to push higher toward 1.3350. The greenback is facing heavy selling pressure amid the sharp decline witnessed in the 10-year US Treasury bond yield.


Gold clings to strong gains above $1,800 as US T-bond yields plunge Premium

Gold staged a decisive rebound on Friday and reclaimed $1,800. The intense flight to safety is causing US Treasury bond yields to fall sharply and fueling XAU/USD's rally. Investors await news on vaccines' effectiveness against the new COVID variant.

Gold News

Cardano could tank to $1 if ADA fails to defend crucial support

Cardano price is currently hovering below a freshly shattered 6-hour demand zone, ranging from $1.68 to $1.79. This resulting crash could extend to the immediate and critical foothold at $1.40. 

Read more

Black Friday 2021 Discounts!

Do you want to take your trading skills to the next level? Now you have a chance of leaping forward at attractive introductory rates. For Black Friday, FXStreet is offering discounts of up to 50% on its upgraded Premium plans. 

Subscribe now!