EURUSD fades the initial optimism and flirts with 1.0350 – by pabspiovano EURUSD Currencies Majors
The greenback recovers ground lost amidst higher yields.Sellers now regain the upper hand and dragEURUSD now trades on the defensive following two consecutive daily pullbacks on the back of some recovery in the greenback.
On the latter, the USD Index looks to put further distance from recent lows in the 105.30 region and climbs past the 106.50 region so far. The corrective move in the pair is so far accompanied by another downtick – the fourth in a row – in the German 10-year bund yields., final inflation figures in the euro area saw the CPI rise 10.6% in the year to October and 5% when it comes to the Core CPI. Across the ocean, weekly Initial Claims come first along with the Philly Fed Manufacturing Index, Building Permits and Housing Starts. Additionally, FOMC’s M.Bowman and P.Jefferson are also due to speak.EURUSD remains unable to print a daily close above the key 1.0400 mark so far, sparking some selling pressure as a consequence. In the meantime, price action around the European currency is expected to closely follow dollar dynamics, geopolitical concerns and the Fed-ECB divergence. In addition, markets repricing of a potential pivot in the Fed’s policy has become the exclusive source of the sharp advance in the pair in recent sessions. Back to the euro area, the increasing speculation of a potential recession in the region - which looks propped up by dwindling sentiment gauges as well as an incipient slowdown in some fundamentals – emerges as the main headwinds facing the euro in the short-term horizon.Eminent issues on the back boiler : Continuation of the ECB hiking cycle vs. increasing recession risks. Impact of the war in Ukraine and the persistent energy crunch on the region’s growth prospects and inflationSo far, the pair is retreating 0.28% at 1.0364 and a breach of 1.0024 would target 0.9925 en route to 0.9730 . On the other hand, the next up barrier comes at 1.0481 seconded by 1.0500 and finally 1.0614 . Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page. If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet. FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted. The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
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