- Dollar and yen up across the board amid risk aversion.
- EUR/USD extends losses to 1-week lows.
The EUR/USD pair is trading below 1.1460 a the lowest in a week. During the last 24 hours lost more than a hundred pips and lost relevant technical levels. The greenback and particularly the yen are rising as equity prices slide in Wall Street with the Dow Jones down 1.55%.
The US dollar remains strong in the market following yesterday’s FOMC minutes and today’s US data. Also, the risk aversion environment favors the demand for the US dollar even as US yields move lower.
Regarding the euro, concerns about Italy have re-emerged around the EU summit. The European Affairs Minister Moscovici mentioned that they must handle budget disagreement with Italy with intelligence and a cool head while Italy’s economy minister Giovanni Tria said he hopes they can narrow differences regarding the budget.
Levels to watch
EUR/USD recently bottomed at 1.1455 and it was hovering around the lows, under pressure. The negative tone intensified after breaking below Asian session lows and accelerated the decline.
The pair is testing a key technical area that is the 1.1460 support. A break and a consolidation below would clear the way for a test of October lows located at 1.1430 followed by 1.1400 and 1.1385. On the upside, resistance now might be seen at 1.1480 and then at 1.1505 and 1.1530 (Oct 18 high).
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