EUR/USD recovery attempt capped at 1.1770
- EUR/USD upside capped at 1.1770, returns to 1.1750.
- The euro gives away gains with the US dollar stronger amid a sourer market mood.
- EUR/USD: A break below 1.1700 might accelerate the downtrend – OCBC.
The euro-dollar bounced up from nine-day lows at 1.1720 earlier today to be halted at 1.1770, where the pair found sellers that pushed it back to 1.1750 area. The euro is trying to remain above 1.1720 support area after a nearly 0.6% drop posted on Tuesday.
The euro pulls back as market sentiment deteriorates
The common currency bounced up early US session on Wednesday, favoured by moderated dollar weakness. Wall Street opened in a slightly positive tone after Tuesday’s negative session, while on the macroeconomic front, the larger-than-expected increase in US producer prices was practically ignored.
The comments of US Treasury Secretary Steven Mnuchin, however, crushed the sentiment somewhat later. Mnuchin cast doubt about the possibility of a coronavirus stimulus agreement before the elections, which pushed Wall Street into negative territory and boosted the dollar across the board, sending the euro down to the mid-range of 1.1700.
EUR/USD: A break below 1.1700 might accelerate the downtrend – OCBC
From a technical perspective, Terence Wu, FX Strategist at OCBC point out to a key level at 1.1700: “With the support at 1.1800 breached, expect 1.1700 to attract, with more downside impetus if that level is also taken out.”
Technical levels to watch