EUR/USD turns negative around 1.1760 on dollar, yields recovery

EUR/USD fades initials gains to the 1.1780 area.
The dollar regains upside traction along with yields.
Flash US Consumer Sentiment comes up next in the docket.

Pablo Piovano FXStreet

After hitting fresh daily tops in the 1.1780 region, sellers return to the market and now drag EUR/USD back to the negative territory.

EUR/USD looks to USD, bonds

EUR/USD now adds to Thursday’s deep pullback to fresh monthly lows in the mid-1.1700s and reverses the initial optimism in response to the bounce in the dollar and US yields.

Actually, yields of the US 10-year reference note come back to life and flirt with the key 200-day SMA around 1.37%, while the buck follows suit and pushes the US Dollar Index (DXY) closer to the key barrier at 93.00 the figure.

Earlier in the euro calendar, the EMU’s Current Account surplus improved to €30.2B in July and final inflation figures in the broader euro zone matched the preliminary readings in August: up 0.4% MoM and 3.0% YoY. In addition, the Core CPI rose 1.6% over the last twelve months.

Later in the US docket, the preliminary results from the Consumer Sentiment is expected to grab all the attention.

EUR/USD levels to watch

So far, spot is losing 0.06% at 1.1757 and faces the next up barrier at 1.1798 (55-day SMA) followed by 1.1845 (weekly high Sep.14) and finally 1.1909 (monthly high Sep.3). On the other hand, a break below 1.1750 (monthly low Sep.16) would target 1.1704 (monthly low Mar.31) en route to 1.1663 (2021 low Aug.20).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

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