EUR/USD looks south amid bear pennant, rising yields, ahead of NFP

EUR/USD pressured as DXY underpinned on rising T-yields.
Bear pennant breakdown on the hourly chart points to more losses.
All eyes remain on US payrolls and politics for fresh impulse.

Dhwani Mehta FXStreet

EUR/USD is off the lows but remains under pressure near 1.2250, as the relentless rally in the Treasury yields buoys the US dollar ahead of the critical NFP release.

The US dollar retreated from session tops above 90.00 vs. its main peers on brief optimism sparked by encouraging news from Pfizer that its coronavirus vaccines appear effective against the new strains of the virus found in the UK and South Africa.

Despite the bounce in the major, the risks remain tilted to the downside, as the Treasury yields will likely rally on US stimulus hopes, lending support to the greenback.

The hourly price chart also paints a bearish picture for the main currency pair, especially after the price confirmed a bear pennant breakdown early Friday.

Further, the bearish crossover, with the 21-hourly moving average (HMA) having pierced the 200-HMA from above, also adds credence to the downside bias. The hourly Relative Strength Index (RSI) trades flat below the midline, currently at 43.30, allowing room for more declines.

Therefore, the sellers could challenge the daily lows of 1.2235 on a fresh supply-wave, below which the 1.2200 level could be put at risk.

On the flip side, 200-HMA at 1.2268 could continue to offer stiff resistance. Acceptance above the latter could call for a test of the 1.2300 psychological magnate once again.

EUR/USD: Hourly chart

EUR/USD: Additional levels

EUR/USD

Overview
Today last price	1.2261
Today Daily Change	-0.0004
Today Daily Change %	-0.03
Today daily open	1.2266

Trends
Daily SMA20	1.222
Daily SMA50	1.203
Daily SMA100	1.1909
Daily SMA200	1.1572

Levels
Previous Daily High	1.2344
Previous Daily Low	1.2245
Previous Weekly High	1.231
Previous Weekly Low	1.2181
Previous Monthly High	1.231
Previous Monthly Low	1.1924
Daily Fibonacci 38.2%	1.2283
Daily Fibonacci 61.8%	1.2307
Daily Pivot Point S1	1.2226
Daily Pivot Point S2	1.2186
Daily Pivot Point S3	1.2126
Daily Pivot Point R1	1.2325
Daily Pivot Point R2	1.2384
Daily Pivot Point R3	1.2424

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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