- The dollar remains firm while the markets fail to recover.
- EUR/USD hovers around 0.9620, far from daily highs.
- The dollar is overbought but offers no signs of correction.
The EUR/USD approaches 0.9600 after recovery from new multi-year lows fades. The euro was unable to hold above 0.9700 and started to slide lower as Wall Street stocks hit new session lows.
Risk aversion prevails in all financial markets, giving support to the dollar. In the United States, the Dow Jones fell 0.61% and the SP500 fell 0.40%. The Nasdaq rises 0.20%. Crude Oil erases gains and metals are back in negative territory.
Economic data released in the US showed a decline in the Chicago Fed’s national activity index, which fell more than expected to 0 from 0.08%. Previously, the IFO reported a decline in the sentiment index in September.
The dollar remains firm across the board amid Fed rate hike expectations and risk aversion. The euro found some support in the recovery of the EUR/GBP which rose to two-year highs.
keep looking down
EUR/USD’s recovery was short-lived and it is approaching 0.9600. Below, attention would focus on the cycle low at 0.9549. Despite the oversold readings on the charts, the negative momentum is solid and the pair continues to look for support.
To the upside, if the euro consolidates above 0.9700 it could gain support from a more sustainable rebound in the very short term. The next strong resistance is seen at 0.9805.
Technical levels
Source: Fx Street
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