EUR/USD looks weak after rejection above 1.1100

EUR/USD is sidelined near 1.1080 ahead of the London open.
Single currency failed to keep gains above 1.11 on Tuesday despite upbeat German data.
The sentiment is quite bearish and a deeper drop to the 100-day average could be in the offing.

Omkar Godbole FXStreet Contributor

EUR/USD is operating on slippery grounds, following Tuesday's rejection above 1.11.

The currency pair had risen to a high of 1.1118 during the European trading hours on Tuesday, courtesy of an upbeat German data.

The German ZEW Indicator of Economic Sentiment rose 16 points to 26.7 in January to hit the highest value since July 2015. The ZEW data confirmed the economy bottomed out in the last quarter of 2019 and is witnessing a rebound.

Even so, EUR/USD's break above 1.11 was short-lived. The pair closed the day with 0.11% losses, producing an inverted hammer and confirming a head-and-shoulders breakdown on the daily chart.

The pair's failure to keep gains above 1.11 despite the upbeat German data indicates the sentiment is quite bearish.

As a result, a deeper decline to the 200-day average at 1.1067 cannot be ruled out. At press time, the pair is sidelined near 1.1080.

On the data front, Italy's Business Climate, Industrial Sales and Industrial Orders for November are scheduled for release on Wednesday. These data sets, however, are not big market movers.

Across the pond, the US housing data is due for release and could influence the greenback.

Technical levels

EUR/USD

Overview
Today last price	1.1083
Today Daily Change	-0.0004
Today Daily Change %	-0.04
Today daily open	1.1087

Trends
Daily SMA20	1.1143
Daily SMA50	1.1101
Daily SMA100	1.1072
Daily SMA200	1.1135

Levels
Previous Daily High	1.1118
Previous Daily Low	1.1086
Previous Weekly High	1.1173
Previous Weekly Low	1.1086
Previous Monthly High	1.124
Previous Monthly Low	1.1002
Daily Fibonacci 38.2%	1.1098
Daily Fibonacci 61.8%	1.1106
Daily Pivot Point S1	1.1076
Daily Pivot Point S2	1.1065
Daily Pivot Point S3	1.1044
Daily Pivot Point R1	1.1108
Daily Pivot Point R2	1.1129
Daily Pivot Point R3	1.114

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

AUD/USD sits at three-week highs above 0.7000 on hawkish RBA-speak

AUD/USD holds a positive bias for the fourth straight day, trading above 0.7000 in the Asian session on Wednesday and at three-week highs. RBA Deputy Governor Andrew Hauser's hawkish remarks and inflation concerns underpin the pair. However, the upside appears capped as the US Dollar attracts some buyers amid looming US-Iran uncertainty.

USD/JPY remains confined in a familiar range below 158.50

USD/JPY sees some dip-buying in the Asian session on Wednesday, though it remains confined within a multi-week range near 158.50 as the uncertainty over the timing of the next BoJ rate hike keeps Japanese Yen bulls on the defensive. Meanwhile, hawkish Fed expectations, bolstered by inflation risks stemming from volatile oil prices, underpin the US Dollar. However, looming intervention fears could limit JPY losses and cap the currency pair.

Gold extends losing spree as US bond yields hold ground

Gold maintains an offered tone heading into the European session, trading near the weekly low it touched earlier this Wednesday, with bears still awaiting a sustained break and acceptance below $4,100 before positioning for further losses. Inflation risks stemming from volatile oil prices underpin prospects for further policy tightening by the US Federal Reserve. Furthermore, a modest US Dollar bounce from a near three-week low is seen weighing on the bullion.

Zcash's bullish reversal eyes $1,698 peak on NU7 upgrade

Zcash (ZEC) shows signs of bullish recovery above $1,200 on Wednesday, following a 9% rebound the previous day linked to the upcoming NU7 upgrade. Blockworks released a Zcash holders report on Tuesday, highlighting steady network growth. The technical outlook for ZEC is bullish, with bulls eyeing an extended rally toward $1,698.

US – Midterm update: Pre-election tail risk scenarios

With two weeks until the US midterm elections on 3 November, early voting has already opened in more than 40 states. Prediction markets are broadly unchanged since we published our Midterm update, 13 October. The prediction market Polymarket continues to see Democrats winning both chambers as the most likely outcome, with a 62.5% probability.

The US Dollar fell. Gold didn't rally. That tells you everything

Gold (XAU/USD) is struggling to capitalize on a weaker US Dollar (USD), after repeatedly failing to establish itself above the $4,200 level. The precious metal remains confined to a relatively narrow trading range despite a combination of developments that would normally support higher prices.