- The dollar rises for the second day and extends the recovery.
- EUR / USD falls to test support around 1.1855.
The EUR / USD failed to sustain in positive territory and just fell to 1.1857, marking a new low for the day.. This level is slightly above Monday’s floor. Hours ago, the pair had climbed to 1.18885.
The setback occurred due to a strengthening of the dollar throughout the market. The US dollar index (DXY) is up 0.18% and is up for the second day in a row, supported by Treasury bond yields. The 10-year rate on the US bond is at 1.36%, very close to its August highs.
The euro for its part, facing the meeting of the European Central Bank (ECB) on Thursday, despite falling against the dollar, rose against the pound, with the EUR / GBP above 0.8600. No changes are expected at the central bank, but the statement, and Lagarde’s words will be followed closely and is expected to have an impact on the euro.
In the US today, normal activity will return after the holiday on Monday. The key figure for the week will be Friday with wholesale inflation.
Testing strong support at 1.1850 / 60
The fall of EUR / USD is testing the 1.1850 / 60 zone, where this week’s bottom is and at the same time last Wednesday’s high. A confirmation below could signal an extension of the downward correction. While in the opposite direction, a rally above 1.1880 could return the initiative to the euro, which needs a claim above 1.1900 to enable further gains.
Technical levels
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