- The euro resumes its downtrend to hit new YTD lows at 1.1560.
- The worsening market mood is favouring the US Dollar against its main rivals.
- EUR/USD: Below1.1600, next target is 1.1500 – TDS Securities.
The euro has resumed its downtrend against the US dollar on Thursday’s US trading session, to hit fresh 14-month lows below 1.1580. The safe-haven dollar seems to be firming up across the board as the market mood deteriorates.
USD bounces up with stock markets turning negative
The common currency is on the defensive again, following a feeble recovery attempt seen during the European session. The US dollar has bounced up after the major US stock markets dipped into negative territory following a mildly positive opening. The Dow Jones Index drops 1.27% with the Nasdaq Index 0.27% lower and the S&P 500 0.87% down at the time of writing.
The US Dollar Index has bounced up from intra-day lows at 94.12 seen during the early US trading session, to regain lost ground and return to 94.40 area, approaching year-to-date highs at 94.50.
The safe-haven greenback has been buoyed by an increasing risk-averse sentiment, to resume the overall positive trend. The dollar has rallied steadily over the last week fuelled by the US Treasuries’ rally on the back of expectations that the Federal Reserve will start to taper bond purchases over the coming months.
EUR/USD to tick down to 1.1500 – TDS Securities
The recent breach of 1.1600 support has increased negative momentum for the euro, according to the TDS Securities’ analysts team, and has set the pair aiming to 1.1500: “Given the real yield outlook, we reckon that the break of 1.16 will be significant for momentum players. Next support comes in at 1.15.”
Technical levels to watch
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