EUR/USD surrenders tepid recovery gains, drops to mid-1.0600s

Haresh Menghani FXStreet

The EUR/USD pair reversed all of its early gains to session high near 1.0680 region and drifted into negative territory for the fifth consecutive session.

Spot ran through some fresh offers during mid-European session and is now navigation at fresh multi-week lows around mid-1.0600s. A modest up-move in the US treasury bond underpinned the greenback demand, helping the key US Dollar Index to reverse early gains and could be attributed to the pair's retracement from session top.

Meanwhile, the recent ECB headlines, that some policymakers oppose changing the central bank's policy outlook, continues to weigh on the shared currency and also seems to be one of the factors collaborating to the bearish bias surrounding the major for the fifth consecutive session.

Markets seemed to have largely ignored the upbeat release of final Euro-zone PMI prints for March, with the greenback price-dynamics being an exclusive driver of the pair's movement on the first trading day of the week.

Later during the NA session, the release of US ISM manufacturing PMI will grab the spotlight and would be looked upon for some fresh trading impetus ahead of a slew of speeches by various FOMC members - New York Fed President William Dudley, Philadelphia Fed President Patrick Harker and Richmond Fed President Jeffrey Lacker.

Technical levels to watch

Immediate support is pegged at 100-day SMA near 1.0630 region, below which the pair is likely to accelerate the slide towards the 1.0600 handle ahead of 1.0555-50 horizontal support.

On the upside, 1.0680 level now becomes immediate resistance, which if cleared decisively might trigger a short-covering rally towards 1.0725-30 resistance, en-route its next major hurdle near 1.0780 level.

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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