EUR/USD: Downside risks grow on fears of US-China trade talks falling apart


  • EUR/USD closed below key rising trendline on Thursday.
  • Investors may sell risk in Europe on fears the US-China trade talks are falling apart.

EUR/USD is on the back foot, having breached key ascending trendline support on Thursday and risks falling to levels below 1.1150 as risky assets are taking a hit on reports stating that China is no longer interested in trade talks with the US.

The shared currency fell from 1.1220 to 1.1166 and closed below the trendline connecting April 26 and May 3 lows on Thursday, as the 10-year treasury yield rose from 2.36% to 2.41% on the back of strong US data and the chance of a Fed rate cut by December, implied by Fed fund futures, fell from 130% to 120%.

Technicals, therefore, are biased bearish. Further, risk assets may take a hit in Europe, adding to the bearish pressures around the EUR on fears the US-China trade negotiations are falling apart.

Xinhua News Agency reported in Asia that China feels Trump’s approach to trade talks lacks sincerity and there is no point in continuing discussions.

Apart from broader market sentiment, the pair may take cues from the final Eurozone inflation reading for April.

Pivot points

    1. R3 1.1273
    2. R2 1.1249
    3. R1 1.1214
  1. PP 1.119
    1. S1 1.1155
    2. S2 1.1131
    3. S3 1.1096


 

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 extends slide, nears the 1.1200 figure

The shared currency is suffering from speculation the ECB will steepen easing and German Business Sentiment falling by more-than-anticipated. Speculative interest now eyeing US Retail Sales to decide whether the 1.1200 level could hold or not.

EUR/USD News

GBP/USD collapsed to fresh 2019 lows

Robust employment data fell short of supporting the Pound, badly hurt from mounting fears about a hard-Brexit, after PM’s candidates, Johnson and Hunt said that the Irish backstop is “dead” and would seek for a new daily, something the EU is not willing to do.

GBP/USD News

USD/JPY: risk sentiment skews the pair to the downside

Political and economic turmoil in Europe weighed on the market’s sentiment. US Retail Sales seen posting a modest advance in June. USD/JPY to resume its decline if the 107.70 support gives up.

USD/JPY News

Gold: Set-up remains in favour of bullish traders; 100-hour SMA marks a key support

Given the recent bullish momentum since late-May, the triangle might still be categorized as a continuation pattern that marks a brief pause and thus, support prospects for a further near-term appreciating move. 

Gold News

US consumption trends: Retail Sales expected to keep healthy growth

US Retail Sales expected to keep a very stable and positive trend. Most of the consumption trends look good, with optimist surveys and nice housing data. Higher consumption is not translating into higher inflation.

Read more

MAJORS

Cryptocurrencies

Signatures


  •  
  •  
  •  
  •  
  •