• EUR/USD was seen consolidating its recent losses to the lowest level since early July 2020.
  • Rising COVID-19 infections in Europe weighed on the euro amid sustained USD buying.
  • Hawkish Fed expectations, elevated US bond yields held the USD near a 16-month peak.

The EUR/USD pair remained on the defensive through the mid-European session and was last seen trading with modest losses, around the 1.1275-70 region.

The pair, so far, has struggled to register any meaningful recovery and remained well within the striking distance of a 16-month low touched on Friday. The shared currency remained on the defensive amid worries about the economic fallout from the return of COVID-19 restrictions in Europe.

Austria said that it would be the first country in Western Europe to reimpose a full lockdown to tackle rising infections, while Germany warned that it may follow suit. This could provide the European Central Bank with another reason to go slow on tightening its monetary policy.

Conversely, the US dollar stood tall near the highest level since July 2020 and remained well supported by hawkish Fed expectations. In fact, the Fed funds futures indicate the possibility for an eventual Fed rate hike move in July 2022 and a high likelihood of another raise by November.

The market speculations were reaffirmed by a fresh leg up in the US Treasury bond yields, which, in turn, acted as a tailwind for the greenback. The fundamental backdrop supports prospects for further losses, though oversold conditions held back traders from placing fresh bearish bets.

Nevertheless, the EUR/USD pair seems vulnerable to prolong its bearish trajectory and any recovery attempt might still be seen as a selling opportunity. Traders now look forward to the release of the Eurozone Consumer Confidence Index and the US Existing Home Sales data for a fresh impetus.

Technical levels to watch

EUR/USD

Overview
Today last price 1.1277
Today Daily Change -0.0011
Today Daily Change % -0.10
Today daily open 1.1288
 
Trends
Daily SMA20 1.1509
Daily SMA50 1.1596
Daily SMA100 1.1699
Daily SMA200 1.1859
 
Levels
Previous Daily High 1.1374
Previous Daily Low 1.125
Previous Weekly High 1.1464
Previous Weekly Low 1.125
Previous Monthly High 1.1692
Previous Monthly Low 1.1524
Daily Fibonacci 38.2% 1.1297
Daily Fibonacci 61.8% 1.1327
Daily Pivot Point S1 1.1234
Daily Pivot Point S2 1.118
Daily Pivot Point S3 1.111
Daily Pivot Point R1 1.1358
Daily Pivot Point R2 1.1428
Daily Pivot Point R3 1.1482

 

 

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.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

EUR/USD stays withing a touching distance of 0.9600

EUR/USD stays withing a touching distance of 0.9600

EUR/USD lost its bullish momentum and declined to the 0.9600 area during the American trading hours on Tuesday. The negative shift witnessed in risk sentiment seems to be helping the dollar gather strength and causing the pair to stay on the backfoot.

EUR/USD News

GBP/USD retreats from daily highs, trades near 1.0750

GBP/USD retreats from daily highs, trades near 1.0750

GBP/USD erased a portion of its daily gains in the second half of the day on Tuesday and fell toward 1.0750. The dollar capitalizes on upbeat consumer confidence data and the risk-averse market environment further weighs on the pair.

GBP/USD News

Gold edges lower toward $1,630 amid rising US yields

Gold edges lower toward $1,630 amid rising US yields

After having climbed above $1,640 earlier in the day, gold reversed its direction and dropped toward $1,630. The benchmark 10-year US Treasury bond yield turned positive on the day near 4% after upbeat US data, not allowing XAU/USD to preserve its bullish momentum.

Gold News

Powell calls for proper crypto regulations as Bitcoin shoots beyond $20,000

Powell calls for proper crypto regulations as Bitcoin shoots beyond $20,000

Powell reckons that a lot of thought must be put into regulating crypto activities. The crypto market’s bullish stint coincides with Powell’s speech “on opportunities and challenges of the tokenization of finance,” at the Louvre Museum in Paris.

Read more

Intel's Mobileye extends Geely partnership, TSMC says wafer orders down

Intel's Mobileye extends Geely partnership, TSMC says wafer orders down

As always, a lot is happening this week in the semiconductor space. Despite the continued decline of share prices all around, the major chip designers and manufacturers continue to announce significant moves.

Read more

Forex MAJORS

Cryptocurrencies

Signatures