- Euro fails to hold to daily gains versus US dollar but prints fresh highs against pound.
- DXY hits fresh highs near 93.30 even as US stocks remains in positive.
The EUR/USD turned to the downside after reaching 1.1850 and it dropped to 1.1792, slightly above the Asian session low at 1.1784. As of writing, it is hovering around 1.1800, modestly higher for the day but far from the top, showing the recovery lacks of strength.
The reversal took place amid a rebound of the US dollar across the board. Following the beginning of the American session, the greenback gained momentum. The DXY erased losses, rose back above 93.00 and peaked at 93.28. Meanwhile, US stocks remain in positive territory. The Dow Jones stands slightly below the highs, up 0.95% and the S&P 500 gains 0.70%.
Technical outlook
The EUR/USD continues to look with some weakness after being unable to recover the 20-day moving average on Monday (1.1810). If the correction from multi-year highs resumes, the next strong support emerges around 1.1700/10.
Analysts at CitiBank, point out in their Weekly FX Insight, that the pair needs to break convincingly through the 1.1900/20 resistance “to sustain gains towards the higher levels of 1.24-1.27 but equally, the current consolidation sentiment points to a higher floor around the 1.1600 area.”
Levels to watch
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