EURUSD is under increased selling pressure as USD demand rises slightly.
The EURUSD pair saw additional supply during the Asian session on Wednesday. And fell to 1.0815 in the last hour, well within striking distance of its lowest level since December 13 reached earlier this week.
The JOLTS report published on Tuesday showed. That US job postings unexpectedly climbed to 9.02 million in December. Implying that the labor market is too strong for The Federal Reserve (Fed) plans to begin reducing interest rates in the first quarter. This, together with geopolitical worries from Middle Eastern wars and China’s economic troubles. Helps the safe-haven US Dollar (USD) maintain its monthly high and puts some pressure on the EURUSD pair.
However, the recent decrease in US Treasury bond yields may prevent USD bulls from initiating aggressive wagers. Ahead of the highly anticipated FOMC monetary policy decision. Which is set to be announced later today. Furthermore, the ambiguity around when the European Central Bank (ECB) would begin decreasing interest rates may operate. As a tailwind for the shared currency. This, in turn, may contribute to restraining any further depreciation in the EURUSD. pair.
EURUSD Technical Outlook
The technical situation favours bearish traders and suggests. That the market will continue to fall.
A prolonged rally over the 1.0900 level is required to reverse the near-term gloomy outlook.
From a technical standpoint, spot prices appear to have found support below the 200-day Simple Moving Average (SMA). Furthermore, oscillators on the daily chart have been accumulating negative traction. While remaining far from oversold territory. As a result, the EURUSD pair appears to have the least resistance on the downside. However, bearish traders may still wait for a persistent break and acceptance below the 1.0800 level before placing new bets.
The continuing decline has the potential to bring spot prices to the December monthly swing low, around 1.0725-1.0720. On their way to 1.0700. Some follow-through selling will reveal the next key support in the 1.0660 area before the EURUSD pair eventually Drops to the 1.0620-1.0615 range on the way to the 1.0600 round figure.
On the other hand, the 1.0845-1.0850 region, or the 200-day SMA. Could operate as an immediate barrier before the 1.0880 and 1.0900 levels. This is followed by a short term trading range support breakpoint, now turned resistance, around the 1.0920 level. Which, if strongly cleared, might spark a short-covering rally. The EURUSD pair may thereafter make another effort to break beyond the psychological barrier of 1.1000.
