EUR/USD off highs, retreats to 1.1600

  • Spot fades the spike to tops above 1.1640.
  • DXY met dip-buyers near 94.50.
  • US 10-year yields climb to tops beyond 2.34%.

A bout of fresh selling impetus has now emerged around the European currency and is dragging EUR/USD to re-visit the 1.1600 neighbourhood.

EUR/USD offered on US data, ECB-speak

Spot gave away part of the daily gains after US initial claims rose to 239K WoW, taking at the same time the 4-week average to 231.25K, the lowest level since 1973.

In addition, ECB’s board member Y.Mersch noted that there are very timid signs of inflation pressures building up in the region, weighing on EUR sentiment.

On the USD-side, the US Dollar Index (DXY) seems to have found some decent support in the mid-94.00s for the time being, rebounding in tandem with the better tone in yields of the US-10 year note.

Later in the NA session, wholesale inventories will close the calendar ahead of tomorrow’s flash gauge of the consumer sentiment for the month of November.

EUR/USD levels to watch

At the moment, the pair is up 0.09% at 1.1605 and a breakout of 1.1692 (high Nov.3) would target 1.1706 (21-day sma) en route to 1.1736 (38.2% Fibo of the 2014-2017 drop). On the flip side, the next support emerges at 1.1555 (low Nov.7) seconded by 1.1448 (high Jun.30) and finally 1.1280 (200-day sma). On the upside, Furthermore, FXStreet’s Technical Confluences Indicator (TCI) is noting an important resistance zone in the vicinity of 1.1620, where sit a pivot point, the 5-day sma, recent highs and a Fibo retracement.

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