- EUR/USD remains on the defensive and is approaching 0.9900.
- Dollar rises to daily highs after yields and data.
- The Jackson Hole Symposium begins Thursday.
Sales pressure forces the EUR/USD to trade a considerable distance from the 0.9900 zone on Wednesday.
EUR/USD now eyeing 2022 lows
EUR/USD sees its daily decline pick up extra pace and approach the recent lows near 0.9900 and a bit lower, always on the back of the relentless move higher in the US dollar.
The dollar’s persistent advance, meanwhile, found additional fuel in the equally strong march north in US yields, with the belly and long end of the curve navigating levels last seen in late June around 3.10. % and 3.30%, respectively.
On the docket, US Durable Goods Orders were flat in July, while orders excluding transportation surprised to the upside and expanded 0.3% MoM.
Also contributing to the rise in US yields and the dollar are consensus expectations of a hawkish message from Chairman Powell in his speech at the Jackson Hole symposium on Friday.
What to keep in mind around the euro
EUR/USD returns to the 0.9900 area, as the USD quickly outpaced Tuesday’s rally.
Meanwhile, the price action around the European currency is expected to closely follow the dynamics of the dollar, geopolitical concerns, fragmentation fears and the divergence between the Fed and the ECB.
Among the negative aspects for the single currency are the growing speculations about a possible recession in the region, which seem to be underpinned by the decline in sentiment indicators and the incipient slowdown in some fundamental indicators.
Technical levels
For now, the pair is down 0.48% at 0.9920 and a break below 0.9899 (23 Aug 2022 low) would target 0.9859 (Dec 2002 low) on the way to 0.9685 (Oct 2022 low) ). On the other hand, the next upside barrier is found at 1.0202 (17th Aug high), followed by 1.0267 (55-day SMA) and finally 1.0368 (10th Aug monthly high).
Source: Fx Street
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