• EUR/USD keeps rebound from weekly low with a choppy range.
  • US Treasury yields rise to April 2021 levels, German Bund coupons refresh two-month high.
  • Covid woes escalate and so do Fed rate-hike expectations but ECB hawks join pre-data cautious to test pair traders.

EUR/USD treads water around 1.1315, irrespective of the broad risk-off mood during early Thursday.

The major currency pair rose the most in a week the previous day, despite posting losses post-Fed Minutes, amid hawkish comments from the ECB policymaker Kazaks. The recent indecision of the EUR/USD pair traders could be linked to the cautious sentiment ahead of the key data, as well as firmer yields in Germany and the US.

Latvian central bank governor and ECB governing council member Martins Kazaks said on Wednesday that the ECB is ready to raise rates and cut stimulus if needed.

On the other hand, the Federal Open Market Committee (FOMC) Meeting Minutes conveyed hawkish bias of the policymakers, suggesting a faster rate-hike and plans to discuss balance-sheet normalization. Following the Minutes, the US bond yields rally and the Fed interest rate futures point at the 80% chance of a hike in March 2022.

Given the strong US ADP Employment Change for December, 804K versus 400K expected, statements from the Fed Minutes like, “conditions for a rate hike could be met relatively soon if the recent pace of labor market improvements continues” also propelled the US bond coupons.

It should be observed that the recent doubling of the covid infections and economic concerns surrounding China also add to the risk-off mood, which in turn propel US Treasury yields and test the EUR/USD buyers.

Amid these plays, the US 10-year Treasury yields jumped to the highest level since April 2021 by the end of Wednesday’s North American session and drowned the Wall Street benchmark. Recently, the US 10-year bond yields refresh a nine-month high of around 1.71%, which in turn weighed on the S&P 500 Futures.

Moving on, Germany’s preliminary readings of Harmonized Index of Consumer Prices (HICP) for December, expected 5.7% YoY versus 6.0% prior, will offer immediate direction to the EUR/USD prices. Should the inflation figures keep rising the ECB hawks may propel the quote.

Following that, the monthly prints of the US Good Trade Balance and ISM Services PMI for December, as well as weekly US Jobless Claims, will entertain short-term market players. However, Friday’s US Nonfarm Payrolls (NFP) is the key.

Read: US December Nonfarm Payrolls Preview: Analyzing gold's reaction to NFP surprises

Technical analysis

As the MACD line teases a bear-cross to the signal line, coupled with the steady RSI, EUR/USD is likely to remain pressured. However, a clear downside break of the 21-DMA level of 1.1300 becomes necessary for the bears to aim for an ascending support line stretched from mid-December 2021, around 1.1280 by the press time.

Alternatively, sustained trading beyond the 1.1300 threshold will direct the EUR/USD prices towards the 50-DMA level surrounding 1.1360.

Additional important levels

Today last price 1.1314
Today Daily Change 0.0003
Today Daily Change % 0.03%
Today daily open 1.1311
Daily SMA20 1.1307
Daily SMA50 1.1363
Daily SMA100 1.1531
Daily SMA200 1.1747
Previous Daily High 1.1347
Previous Daily Low 1.1277
Previous Weekly High 1.1386
Previous Weekly Low 1.1274
Previous Monthly High 1.1386
Previous Monthly Low 1.1222
Daily Fibonacci 38.2% 1.132
Daily Fibonacci 61.8% 1.1304
Daily Pivot Point S1 1.1277
Daily Pivot Point S2 1.1242
Daily Pivot Point S3 1.1207
Daily Pivot Point R1 1.1346
Daily Pivot Point R2 1.1381
Daily Pivot Point R3 1.1416



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 Join Telegram

Recommended content

Recommended content

Editors’ Picks

EUR/USD recovers above 1.0400, looks to post weekly gains

EUR/USD recovers above 1.0400, looks to post weekly gains

EUR/USD regained its traction after dropping toward 1.0350 in the early American session and climbed above 1.0400. Trading conditions remain thin on Black Friday and the pair remains on track to end the week in positive territory.


GBP/USD recovers toward 1.2100 as US Dollar loses strength

GBP/USD recovers toward 1.2100 as US Dollar loses strength

GBP/USD managed to stage a recovery toward 1.2100 in the American session on Friday and now looks to register gains for the third straight week. The US Dollar struggles to preserve its strength as markets remain subdued on Black Friday. 


Gold steadies near $1,750 as US yields retreat

Gold steadies near $1,750 as US yields retreat

Gold price continues to move sideways at around $1,750 heading into the weekend. The benchmark 10-year US Treasury bond yield retreated from the daily high it touched above 3.75% earlier in the day, allowing XAU/USD to erase a portion of its daily losses.

Gold News

Bitcoin: Assessing chances of one last bear market rally for 2022

Bitcoin: Assessing chances of one last bear market rally for 2022

Bitcoin price is in a good place to trigger another bear market rally from a high-time frame perspective. This development, combined with the optimistic outlook seen in on-chain metrics, further strengthens the possibility of a happy ending to 2022.

Read more

FX next week and yield curve inversions

FX next week and yield curve inversions

Since the Fed's last raise November 3, Fed Funds rate opens and closes at 3.83. The Fed Funds rate once traded freely on its own with highs and lows as any financial instrument. In 2000, Central banks implemented meetings every 6 weeks.

Read more