VOT Research Desk
In the wake of unsubstantiated claims that two people may have died when errant Russian missiles may have struck NATO member Poland, the US dollar made a strong comeback from a more than three-month low.
The most recent incident raises the possibility of further escalating Western-Russian relations, which led investors to seek safety in the traditional safe-haven dollar.
This was subsequently identified as a crucial element that drew some selling near the major and caused the nighttime steep pullback.
Moving forward, the speech by ECB President Christine Lagarde will be scrutinised for a new impetus. Traders will continue to rely on the US Retail Sales statistics later on during the early North American session.
This will affect the USD price dynamics and create short-term trading possibilities around the EURUSD pair, along with US government rates and recent geopolitical developments.
EUR/USD Technical Analysis
Technically, the overnight failure close to the 200-day SMA calls for some caution from bullish traders. However, it will still be wise to wait for continued weakness below the 1.0300 level before concluding that the recent strong rally seen over the past two weeks or so has peaked.
The EURUSD pair will become more susceptible to retesting the round number 1.0200 if there is some follow-through selling below the 1.0280-1.0270 area.
The 100-day SMA resistance breakpoint, which is currently in the 1.0100-1.0090 region, may be reached as the corrective slide continues.
On the other hand, the 1.0400 level appears to be acting as immediate resistance in advance of the 1.0420 region right now (200 DMA).
The nocturnal swing high, located between the psychological levels of 1.0500 and 1.0480, comes next.
The EURUSD pair may be lifted towards the following pertinent barrier close to the 1.0575–1.0580 supply zone if there is a sustained strength beyond. Bullish traders will view some additional follow-through buying above the round number of 1.0600 as a fresh trigger, and this will pave the way for another short-term appreciating advance.
