- The dollar remains firm against the main European currencies.
- The euro also falls against the pound.
- EUR/USD continues with a negative outlook despite oversold levels.
The EUR/USD is falling for the fifth day in a row and reached as low as 1.0584, reaching the lowest level since April 2017. The euro then trimmed losses and climbed to meet resistance at the 1.0620 area.
The negative moment in the EUR/USD remains firm, further ratified by the lack of strength in the recent rebound. If above 1.0620, the next resistance is at 1.0650/55. A break of this last level could point to a respite for the pair.
Downside risks continue to dominate. Possible supports to resume lowers can be seen at 1.0570 (April 2017 low), followed by 1.0550 and then a stronger area at 1.0490 (Feb/March 2017 low).
The dollar is still the key
The dollar rally remains the key factor behind the EUR/USD pullback. The pair is looking for a new level of balance. DXY rises for the fifth day in a row and trades at 102.65, in the zone of highs since March 2020.
The advance of dollar against European currencies it remains firm, although it has moderated in recent hours, due to a rebound in equity markets and stable Treasury yields.
The euro It also falls against the pound. The data did not help the common currency with a larger-than-expected drop in consumer confidence in Germany. In addition, the cut in the supply of Russian gas to Poland and Bulgaria generated a rise in the price of European gas.
Ahead of Wednesday is the release of US foreign trade data, pending home sales and wholesale inventories. No big impact is expected from these data. The relevant will arrive on Thursday with the first GDP reading for the first quarter, and on Friday it will be the turn of the Eurozone.
Technical levels
Source: Fx Street
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