- Euro fails to hold above 1.1100 versus US dollar, turns negative.
- US data below expectations but weaker euro limits upside in EUR/USD.
The EUR/USD pair turned tot he downside after hitting at 1.1115, the highest level since November 5. It dropped to 1.1070, into negative territory for the day. As of writing it is hovering near 1.1075, back into the previous range.
Nothing happened here
The euro jumped versus the US dollar after the ADP report and peaked following the ISM Non-Manufacturing. It broke the critical resistance at 1.1090 that capped the upside several times over the last three weeks. When the pair was getting ready for an extension of the rally that started last week from 1.0980, it reversed falling back under 1.1100.
The EUR/USD pair dropped back to the previous 1.1065/1.1090 range. It appears the euro is not ready to extend the rally above 1.1100. The reversal took place amid a stabilization of the greenback but particularly it was possible due to some weakness in the euro. Also, the Swiss franc is among the worst performers.
Beyond US economic data, trade developments continue to be a key driver in the market’s mood. “Market risk sentiment improved amid speculation that China and the US might be closer to a trade deal, but it didn’t fully recover from the recent flood of negative trade news,” explained BBVA analysts. The Dow Jones is up 0.75% and the Nasdaq gains 0.66%.
Technical levels
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