EUR/USD Price Testing March Lows at 1.1720, ZEW Survey Hurts

• EUR/USD retreated to multi-month lows of 1.1720.
• The dismal ZEW survey data of the Eurozone further fueled the selling.
• Further fresh impetus will be provided by the US non-farm productivity, labor cost and US CPI.

The EUR/USD price retreated downward again after moving sideways around 1.1750 during Tuesday’s Asian session, reaching 1.1716, its lowest level since late March. As a result, the EUR/USD exchange rate is down 0.15% for the day at 1.1720 at the moment of writing.

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The disappointing ZEW survey results for the Eurozone seem to have pressured the common currency on Tuesday. The Economic Sentiment Index for the Eurozone fell from 61.2 in July to 42.7 in August, which was well above the market expectation of 72 points. Furthermore, German economic sentiment fell from 63.3 to 40.4.

The relentless strength of the dollar, on the other hand, makes EUR/USD’s loss exceedingly difficult to contain. At 93.06, the US dollar index is highest since July 21, up 0.1% for the day.

The US economic summary will present non-farm productivity and unit labor costs for the second quarter later in the session. In addition, Wednesday will be an important day for the US Bureau of Labor Statistics, which will release consumer price index (CPI) data for July.

EUR/USD technical analysis: Bearish bias is evident

The average daily range for the pair has squeezed to 56 pips for the last twenty trading days. Today, the pair has so far moved 27 pips, maintaining a rangebound behavior with greater bias on the lower side. The pair is near the key support of March 31 swing lows of 1.1720. If broken, the pair may lead the price towards 1.1660 ahead of 1.1610 (November 04, 21 lows).

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The volume is clearly on the bearish side. The pair can find interim support near the the1.1700 area. But there is no hope for a reversal. However, there is a probability of an upside correction towards 1.1750.

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