EUR/USD eyes yearly low under 1.1600 as USD regains footing ahead of EU/US PMI


  • EUR/USD refreshes intraday low, fades corrective pullback from 2021 bottom.
  • US dollar tracks firmer US Treasury yields amid fears over China, US stimulus and debt ceiling.
  • Reflation, tapering concerns favor bears ahead of the key PMIs for September.

EUR/USD bulls witness rejection after a two-day run-up during early Tuesday, down 0.18% on a day near 1.1600 heading into the European session. The Euro pair portrays the broad US dollar rebound to recall the bears targeting the yearly low ahead of crucial activity numbers from the bloc, as well as from the US.

The US dollar rebound, the first in the last four days, could be linked to the sour sentiment that recently took clues from China and US politics. That said, the US Dollar Index (DXY), a gauge of the greenback versus the major currencies, gains 0.17% on a day as the bulls poke the 94.00 threshold by the press time.

While the Evergrande default fears loom, the line of Chinese real estate firms that may roil the financials seems to be longer. Earlier in the day, Bloomberg conveyed the news of Fantasia Holdings Group’s missed debt payment. While global rating giant Fitch downgraded a Beijing-based property developer Sinic afterward.

Also challenging the market sentiment is the indecision over the passage of the US infrastructure spending bill and the debt limit extension amid Republicans’ strong rejection of President Joe Biden’s “all or none” approach. It’s worth noting that US President Biden’s recent readiness to alter the cap of the stimulus is yet to woo the opposition and hence today’s North American session will be interesting for political watchers.

Adding to the risk-off mood could be Japan’s fresh PM Fumio Kishida who hints at joining the US in taming China’s rush for power in Taiwan.

Amid these plays, the US 10-year Treasury yields extend the previous day’s recovery moves to 1.50%, up 1.7 basis points (bps) while stock futures remain sluggish at the latest.

It should be observed that the latest comments from the US Federal Reserve (Fed) and the European Central Bank (ECB) policymakers, namely St. Louis Fed President James Bullard and ECB Vice President Luis de Guindos, keep suggesting the fears of higher inflation. However, the Fed tapering gains more attention and propels the US dollar than the ECB chatters to the Euro.

Given the cautious sentiment, EUR/USD traders will pay close attention to the final reading of September month’s Markit PMIs for short-term direction. Though, the US ISM Services PMI for the stated month, expected 60 versus 61.7, will be watched closely for the hints of Friday’s Nonfarm Payrolls.

Read: US September ISM Services PMI Preview: Eyes on inflation and employment details

Technical analysis

Unless breaking convergence of the 50-SMA on a four-hour chart (4H) and a downward sloping trend line from mid-September, near 1.1660, EUR/USD bears stay on the way to the yearly low surrounding 1.1565-60.

Additional impotant levels

Overview
Today last price 1.1599
Today Daily Change -0.0022
Today Daily Change % -0.19%
Today daily open 1.1621
 
Trends
Daily SMA20 1.173
Daily SMA50 1.1767
Daily SMA100 1.188
Daily SMA200 1.1963
 
Levels
Previous Daily High 1.164
Previous Daily Low 1.1588
Previous Weekly High 1.1727
Previous Weekly Low 1.1563
Previous Monthly High 1.1909
Previous Monthly Low 1.1563
Daily Fibonacci 38.2% 1.162
Daily Fibonacci 61.8% 1.1608
Daily Pivot Point S1 1.1592
Daily Pivot Point S2 1.1564
Daily Pivot Point S3 1.154
Daily Pivot Point R1 1.1645
Daily Pivot Point R2 1.1669
Daily Pivot Point R3 1.1697

 

 

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: Bulls step in at month-end, eyeing the upside

EUR/USD is set to close off a bearish week towards a test of 1.11 the figure after breaking out of the bearish weekly wedge to the downside. Bulls have an eye on the weekly M-formation and prospects of a significant correction. 

EUR/USD News

GBP/USD slumps toward 1.3350, renews five-week lows

GBP/USD stays under constant bearish pressure on Thursday and trades at its lowest level since late December below 1.3370. Following the upbeat growth data from the US, the US Dollar Index is rising more than 0.7% on the day above 97.00. 

GBP/USD News

Gold licks wounds at three-week low near $1,800 amid firmer USD

Gold bears take a breather around $1,797 as Friday’s Asian session begins, following a $50 slump in the last two consecutive days to a three-week low. The yellow metal awaits fresh clues after piercing the $1,800 threshold the previous day.

Gold News

Bitcoin struggles against resistance as bulls keep their eye on $40,000

Bitcoin price action faced intense selling pressure after the Fed’s decision, with Bitcoin losing more than 5% from its Wednesday high. If the sell-off from the top wasn’t discouraging enough for bulls, then the daily close in the red certainly added insult to injury.

Read more

Apple (AAPL) Earnings for Q1 beats estimates on EPS and revenue

Apple (AAPL) reported earnings after the close on Thursday. Earnings per share (EPS) came in at $2.10 versus the estimate of $1.89. Revenue was $123.9 billion versus the estimate for $118.66 billion. AAPL is trading at $162.40 in Thursday's aftermarket, a change of 2% versus the regular session close of $159.16.

Read more

Forex MAJORS

Cryptocurrencies

Signatures