Search ForexCrunch
  • Volatile within range, but downside opening below 1.1694?
  • Awaits fresh fundamental news for further trading impetus.

EUR/USD extends its choppy-trend into the European session, although fails to take-out the fresh eight-day highs reached at 1.1750 earlier today.

EUR/USD looks to test 5-DMA at 1.1694

Over the last hours, the upside attempts in the spot fizzled out, as the bears fought back control to test the 5-DMA support at 1.1694, despite a pause in the US dollar recovery from nine-day lows versus its main competitors. The USD index drops -0.10% to 94.35, having faced stiff resistance near 94.50 region. The greenback remained weighed down by Trump’s comments on the Fed’s rate hike plans and fx manipulation.

However, the losses may remain capped, as the common currency continues to derive support from a rally in the 10-year German bond yields. The 10-year German yields climb to fresh five-week highs at 0.393%, up +4.10% on the day. Also, the risk-off trades in the European equities combined with escalating trade war tensions collaborate to the upbeat tone around the funding currency, the EUR.

In the day ahead, the major will take fresh cues from the US existing home sales data and Eurozone consumer confidence figures for further momentum. Meanwhile, the USD dynamics and risk trends will continue to influence the prices amid a data-empty EUR calendar.

EUR/USD Technical Levels

Slobodan Drvenica at Windsor Brokers noted, “extended weakness of the dollar keeps the single currency supported, along with bullish techs, but bulls need close in the cloud (cloud base lays at 1.1724) and break above 1.1754 (triangle resistance), to generate a bullish signal for recovery extension. Risk of recovery stall exists as very thick falling daily cloud continues to weigh heavily and has already capped several attempts to break higher. Broken 55SMA (1.1708) holds today’s action and marks pivotal support, loss of which would generate an initial bearish signal. Res:  1.1754; 1.1790; 1.1848; 1.1873. Sup:  1.1708; 1.1686; 1.1663; 1.1621.”