EUR/USD breaks below 1.0600, targets December lows?
The bullish pressure behind the US dollar keeps intensifying as we head towards mid-Asia, knocking-off EUR/USD below 1.06 handle for the first time since Dec 2015.
EUR/USD heavy on Yellen
Currently, EUR/USD now drops -0.29% to 1.0593, hovering within a striking distance of fresh multi-month lows struck at 1.0582 last minutes. The main currency pair extends its losing streak into a 10th straight session today, with the bears retaining control on the back of rising treasury yields and USD, in wake of a Trump win in the US elections.
However, the renewed weakness seen in the EUR/USD pair since yesterday is mainly attributed to divergent monetary policy outlooks, especially after Fed Chair Yellen noted in her testimony that an increase in interest rates “could well become appropriate relatively soon” if incoming data provide some further evidence of continued progress toward the FOMC twin goals.
Meanwhile, the USD index sits at more-than 13-year tops reached at 101.37 levels, while the treasury yields continue to their upward march, with the 2-year yields rallying +3.55% to 1.062%.
Amid a data-light economic calendar, focus will remain on ECB Chief Draghi’s speech and a slew of Fedspeaks due later today.
EUR/USD Technical Levels
In terms of technicals, the pair finds the immediate resistance 1.0629 (daily high). A break beyond the last, doors will open for a test of 1.0675 (5-DMA) and from there to 1.0700 (round figure). On the flip side, the immediate support is placed at 1.0582 (multi-month lows) below which 1.0556 (Nov 2015 low) and 1.0538 (Dec 2015 low) could be tested.
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