EUR / USD extends fall to 1.1860 zone, new low in three months

• The euro fails to find support and loses 1.1900.
• The dollar remains firm in the market, supported by a climate of risk and rising bond yields.

The EUR / USD is falling for the fourth day in a row and is failing to find support. The price lost 1.1900 and fell to 1.1864, the lowest level in three months. It is trading at 1.1880, in an attempt to break away from the lows, but continues to face negative pressures.

The dollar began to gain momentum in the Asian session as a rise in Treasury yields and a decline in the price of stocks. The approval of the Biden stimulus plan in the Senate did not generate a great impact as it was expected. Now it will have to be approved by the House of Representatives, possibly on Tuesday.

Another part of the support for Negative outlook for EUR / USD is the expectation of higher growth in the US than in the Eurozone in the future product of the evolution of the vaccination process. This is also reflected in a decline in the EUR / GBP, as the UK is expected to recover faster.

Regarding data, there was a rise to 5.0 in the Sentix Eurozone consumer confidence index from -0.2 and above the 1.9 expected. Previously, there was an unexpected contraction in German industrial production in January of 2.5%. The key event of the week will be Thursday’s meeting of the European Central Bank (ECB).

From a technical point of view, the EUR / USD maintains a bearish bias and with significant pressure. Indicators on the day chart are at extreme levels indicating oversold, but there is no indication of a change or correction yet. In case of extending the drop below 1.1860, the supports below can be located at 1.1835 and 1.1790. On the upside, 1.1900 is now a resistance to watch out for, followed by 1.1935 and 1.1960.

Technical levels