EUR/USD: Bears target 1.1800 as USD recovers

The EUR/USD pair extending its choppiness into early Europe, and now flirts with daily lows near 1.1820 levels amid broad based US dollar recovery.

EUR/USD eyes key support near 1.1800

Renewed pick-up in buying interest seen around the US dollar against its major peers, in the wake of the recovery in Treasury yields, exerts downward pressure on EUR/USD. The USD index rises +0.10% to print daily tops of 93.09.

Treasury yields rebounded from softer US CPI-led sell-off, as the US Treasury bonds got sold-off into improving risk sentiment, which diminished Treasuries’ demand as a safe-haven asset.

Moreover, expectations of a sharp contraction in the Eurozone industrial production data also collaborates to the latest leg down in the Euro, with the bears now targeting the key support located near 1.1800 levels – the confluence zone of 5 and 10-DMA.

EUR/USD Technical Set-up  

Haresh Menghani, Analyst at FXStreet explains: “Any weakness back below the 1.1800 handle might now be looked upon as a buying opportunity, which should eventually limit any further fall near the 1.1745-35 support area (38.2% Fibonacci retracement level). Meanwhile, on the upside, the 1.1840-50 horizontal zone is likely to act as immediate resistance, above which the pair is likely to dart towards reclaiming the 1.1900 handle. The bullish momentum could further get extended towards 61.8% Fibonacci expansion level resistance near the 1.1950-55 region.”