- Despite high US T-bond yields, EUR/USD rebounds after two consecutive days of losses.
- A risk-on impulse underpinned the Euro to the detriment of the US Dollar.
- EUR/USD Price Analysis: Triple bottom pattern remains in play as long as EUR/USD stays above 1.0759
EUR/USD snaps two straight days of losses and climbs after hitting a daily low of 1.0744 amidst a subdued session. Despite high US Treasury bond yields, risk-appetite improvement and a softer US Dollar (USD) opened the door for further Euro (EUR) upside. At the time of writing, the EUR/USD is trading at 1.0789 above its opening price.
US equity markets are mixed, with the Dow Jones and the S&P 500 rising while the Nasdaq tumbles. Market participants cheered First Citizens BancShare’s takeover of the Silicon Valley Bank (SVB), while US authorities are considering expanding emergency lending facilities to First Republic Bank.
Data-wise, the March US Dallas Fed Manufacturing Index plunged -15.7, more than February’s -13.5 collapse and worse than the -10.9 estimate. Delving into the data, the Production Index and the Employment component rose. New Orders declined, and the Price Index fell from 15.5 to 7.0.
US Treasury bond yields recovered, with 2s meandering around 4%, while the 10-year benchmark note rate sits at 3.515%, gaining thirteen basis points. The greenback has failed to capitalize on the US bond yields rise, with the US Dollar Index (DXY) sliding 0.19% at 102.915.
On the Eurozone (EU) front, European Central Bank (ECB) speakers are crossing the wires. Nagel acknowledged the increasing importance of taking a meeting-by-meeting approach, though he emphasized that the path of monetary policy normalization would continue. He added that QT would accelerate soon. On the flip side, ECB’s de Cos took a cautious approach due to high levels of uncertainty in the financial markets.
Of late, ECB’s board member Isabel Schnabel commented that she wanted to signal that further rate hikes were possible, according to people who know the matter.
EUR/USD Technical analysis
Technically speaking, the EUR/USD is neutral to upward biased, with a triple bottom staying in play as long as the EUR/USD remains above 1.0759. Oscillators are giving mixed signals. The Relative Strength Index (RSI) favors EUR/USD upside, while the Rate of Chance (RoC) suggests that buying pressure is waning. The path of least resistance is upwards; therefore, the EUR/USD first resistance would be 1.0800. Once broken, the EUR/USD’s next ceiling would be 1.0929, followed by the 1.1000 figure.
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.
Recommended content
Editors’ Picks
USD/JPY holds positive ground around 151.50 following Japanese CPI data
The USD/JPY pair holds positive ground for the second consecutive day near 151.45 on Friday during the early Asian trading hours. The cautious approach from the Bank of Japan to keep monetary conditions accommodative exerts some selling pressure on the Japanese Yen.
AUD/USD holds above 0.6500 in thin trading
The Australian Dollar managed to recover ground against its American rival after AUD/USD fell to 0.6484. The upbeat tone of Wall Street underpinned the Aussie despite broad US Dollar strength and tepid Australian data.
Gold price finishes Thursday’s session set to reach new all-time highs
Gold price rallied during the North American session on Thursday and hit a new all-time high of $2,225 in the mid-North American session. Precious metal prices are trending higher even though US Treasury yields are advancing, underpinning the Greenback.
Bitcoin price extends retreat from $69K as old whales shift their holdings to new whales
Bitcoin price continues to move further away from the $69,000 threshold, gaining ground as BTC bulls hope for a retest of the $73,777 peak. This is because of the general assumption that clearing this blockade would set the tone for a reach higher, marking a new all-time high.
Bears have been standing before a steamroller so far this year
Despite a pushback on rate cuts from Christopher Waller, and what was supposed to be cautious trading sentiment ahead of critical US inflation data released later on Friday, the S&P 500 rose on Thursday, marking its best first-quarter performance in five years.