EUR/USD drops below 1.11, Dow futures down 240 points

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 8, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    The EUR/USD continues to lose ground, dropping to 1.1093 in early US, even though the Dow futures are pointing to sharp early losses.

    USD is back as a safe haven?

    The risk-off in the markets and the resulting sharp drop in the Fed rate hike bets are making treasuries an attractive safe haven asset. As of now, the yields are down (prices up) across the curve, with the 10-yr yield trading lower by 6 basis points.

    Consequently, the greenback has been able to hold its own against the funding currency EUR. It remains to be seen if the USD is back as a safe haven currency; given the falling rate hike bets.

    EUR/USD Technical Levels

    The spot currently trades just below 1.11 handle. The immediate support is seen at 1.1088 (50% of Mar low-Aug high), under which the losses could be extended to 1.1006 (50% of 1.1495-1.0517). On the other hand, a break above 1.1121 (61.8% of 1.1495-1.0517) could see the spot re-test 1.1184 (daily high).
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