EUR/USD slides farther below 1.1200 handle

The EUR/USD pair maintained its offered tone and extended its slide farther below the 1.1200 handle to hit fresh session low near 1.1170 region.

The shared currency was being weighed down by Thursday's downward revision of ECB's inflation outlook through 2019 and the central bank's readiness to increase its asset-buying program, if needed, negating slight upgrade of the growth projection for next few years and tapering comments by ECB's Nowotny. 

   •  ECB’s Nowotny: We will discuss tapering at July, Sept meetings

Today's slide was also partly due to the US Dollar strength led by a sharp slump in the British Pound in wake of the UK snap general election outcome, where May's ruling Conservative Party lost its majority.

Meanwhile, yesterday's public testimony by former FBI Director James Comey’s, which offered little surprise to spark further political turmoil in the US, provided an additional boost to the greenback and further collaborated to the pair's offered tone for the third consecutive session. 

In absence of any major market moving economic releases from the US, long unwinding pressure might continue to drag the pair lower and a break below mid-1.1100s remains a distinct possibility.

   •  EUR/USD risks have now shifted to the downside – UOB

Technical levels to watch

A follow through weakness below 1.1150 immediate support is likely to accelerate the slide towards 1.1110 level (May 30 low) before the pair eventually drops to its next support near 1.1075 level (May 18 low). 

On the upside, any recovery move back above the 1.1200 handle might continue to confront fresh supply near 1.1235-40 region, which if cleared might trigger a short-covering rally back towards yearly tops resistance near 1.1280 area.