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EUR/USD under pressure below 1.08 as European stocks waver

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 5, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    FXStreet (Mumbai) - The EUR bears picked up significant strength in the last hours, sending EUR/USD to fresh session lows below 1.08 handle.

    EUR/USD drops further as Europeans stocks pop

    Currently, the EUR/USD pair trades -0.35% lower at 1.0794, swiftly recovering from a dip to 1.0785 – fresh session lows. Having peaked at 5-DMA in early Asia, the EUR/USD pair continues to drift lower, now surrendering the 1.08 handle in wake of a modest recovery staged by the European indices after heavy losses booked yesterday.

    Moreover, the ongoing strength in the US dollar across the board also weighs heavily on the main currency pair. However, the downside appears limited as the EUR bulls find some respite from the upbeat German unemployment data (jobless rate held steady at 6.3% in Dec). While expectations of a better EZ CPI print also helps support EUR/USD. The EZ CPI due later in the session ahead, is seen rising 0.4% in Dec versus a 0.2% rise seen in Nov.

    EUR/USD Technical Levels

    In terms of technicals, the pair finds the immediate resistance is seen at 1.0839 (5-DMA). A break beyond the last, doors will open for a test of 1.0861 (1h 50-SMA). On the flip side, the immediate support is placed at 1.0780 (Jan 4 Low), below which 1.0753 (daily S1) could be tested.
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