EUR/USD quickly retreats toward 1.1150 after a spike to 1.1187 on Brexit news

  • US Dollar drops but then trims losses against Euro and Pound after UK PM May statement. 
  • EUR/USD holds to a negative bias, near year-to-day lows. 

The EUR/USD pair jumped to 1.1187, reaching the highest level since last Thursday during UK PM May’s presentation of a new Brexit deal. The move was short-lived and it quickly pulled back. As of writing, EUR/USD trades at 1.1155/60, back into negative territory for the day. After the brief spike, the pair holds a negative tone and remains close to the 2-week low it hit earlier today at 1.1140.

May presented a new withdraw agreement that is not clear it will pass through the Parliament. Initially, the Pound rallied and pushed the Euro to the upside. But as GBP/USD retreated, EUR/USD also did the same, erasing all gains. 

The greenback is up against majors, including the Euro. The DXY is up 0.10% above 98.00 and recently hit the highest intraday level in a month. But the US Dollar is losing ground versus Emerging market currencies. In Wall Street, US stocks are up on the back of the decision to temporarily eased curbs on Huawei. 

Data from the  US released today showed a decline in existing home sales. Market consensus pointed to an increase to 5.35M, but sales dropped to 5.19M in April. The next key event in the US will be tomorrow with the FOMC minutes. 

EUR/USD short-term levels 

The pair continues to move with a bearish bias. If it managed to rise and hold above 1.1180 (short-term downtrend), it could remove the current pressure. Above the next resistance level might be seen at 1.1200 and 1.1225. 

On the flip side, 1.1150 is again a potential support followed by the daily low at 1.1140. Below attention would turn to the 2019 low at 1.1110. A decline under the last one could trigger volatility. 

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