The EUR/USD pair dropped further on Wednesday, touching its lowest level in over a month as the dollar continues to profit from the risk-off environment.
At the time of writing, the EUR/USD pair is trading at the 1.0820 zone, 0.4% below its opening price, after hitting its lowest level since April 3 at 1.0810.
Despite encouraging news regarding the United States debt ceiling, the market sentiment remained suppressed. President Joe Biden met with lawmakers on Tuesday and stated they could strike a deal by the end of the week.
US Treasury yields remain on the rise across the curve, further fueling the dollar’s rally. The 10-year note rate climbed for a fourth consecutive day to reach 3.570%.
Meanwhile, the European Central Bank (ECB) members remain split regarding the path of interest rates, which seems to be weighing on the euro. Swap markets suggest a 25 bp hike is already fully priced in for the June meeting, with probabilities of an equal increase in July rounding 60%.
On Wednesday, data from the Eurozone showed the Harmonized Index of Consumer Prices (HICP) inflation rate was downwardly revised to 0.6% in April, advocating in favor of ECB doves.
From a technical perspective, the EUR/USD short-term technical outlook has turned full-on negative according to indicators on the daily chart and on smaller timeframes. After breaking below the 1.0900 area, the price is now on track to challenge the 100-day simple moving average (SMA), which is reinforcing the 1.0800 support zone.
If the EUR/USD breaks below the 1.0800 zone, it could accelerate losses targeting the 1.0750 level. Conversely, a recovery of the 1.0900 psychological and Fibonacci resistance level could improve the short-term structure, aiming at the 1.1000 level.
- SEO Powered Content & PR Distribution. Get Amplified Today.
- PlatoAiStream. Web3 Data Intelligence. Knowledge Amplified. Access Here.
- Minting the Future w Adryenn Ashley. Access Here.
- Buy and Sell Shares in PRE-IPO Companies with PREIPO®. Access Here.
- Source: https://www.tradingview.com/chart/EURUSD/1sB4B4nQ-EUR-USD-Drops-to-Lowest-Level-in-a-Month-Threatens-Key-100-DMA/
