EURUSD under increased bearish pressure, possibly reaching 1.0820
After ending in the red on Monday, the EURUSD continued to fall. Reaching its lowest level in three weeks near 1.0800 early Tuesday. Technical sellers may remain interested unless the pair stabilizes above 1.0820.
The steady recovery in US Treasury bond yields. Combined with a risk-averse market environment, helped the US Dollar (USD) beat its competitors on the opening trading day of the week. As investors remain anxious about the Israel-Hamas conflict spreading throughout the region. Middle East and safe haven movements continue to dominate early Tuesday’s financial market action. At the time of publication, US stock index futures were down 0.3% to 0.4%.
JOLTS Job Openings and ISM Services PMI data will be featured on the US economic docket.
In the second half of the day, the US economic docket will include JOLTS Job Openings data for October. And the ISM Services PMI for November. If there is a considerable fall in the number of job postings, the USD may struggle to maintain its strength.
EURUSD Investors will also pay special attention to the ISM survey’s inflation component, the Prices Paid Index. An unexpected rise in this figure could assist the USD in finding demand.
Nonetheless, until risk sentiment improves later in the day. EURUSD may struggle to break out. Even if the evidence does not support the USD, it will regain traction.
Technical Analysis
EURUSD fell below 1.0820 early Tuesday, where the 200-day SMA and the Fibonacci 38.2% retracement of the recent rise are placed.
Below this, 1.0800 (psychological level) serves as an intermediate support level before the 1.0760-1.0770 range (Fibonacci 50% retracement, 200-period SMA on the 4-hour chart).
Sellers may be deterred if the EURUSD rebounds above 1.0820 and confirms that level as support. 1.0860 (20-period SMA) could be considered as the first resistance level in this situation, followed by 1.0900 (Fibonacci 23.6% retracement, 100-period SMA).
