- The sharp drop in UM consumer confidence triggers a selloff of the USD.
- EUR / USD tests 1.1800, heading for weekly gains.
- The US dollar is about to end the week under pressure, US yields fall sharply.
EUR / USD rallied even higher and hit a new weekly high at 1.1800. The pair is moving around the highs, with the bullish tone in place as the US Dollar remains under pressure across the board.
The dollar fell on Friday after the University of Michigan consumer sentiment report accelerated its decline. The index unexpectedly fell to 70.2, the lowest level since 2011. US bond yields fell and the DXY fell towards 92.50.
The EUR / USD pair is rising 70 pips on Friday, the best performance in months. The euro is also higher against the pound, but fell against the Swiss franc.
technical perspective
Technical readings on the daily chart show that sellers remain in control, according to Valeria Bednarik, chief analyst at FXStreet. “A bearish 20 SMA provides dynamic resistance around 1.1800 while developing well below the longer ones, which lack directional strength. Meanwhile, the Momentum indicator is below its midline, while the RSI is rebounding from oversold readings, currently around 45 ”.
Bednarik cautions that a break below the 1.1700 level should trigger a downside extension towards the 1.1600 / 40 area, “while further declines should expose the 1.1520 level.” On the upside, he mentions that above 1.1800, the next resistance levels are at 1.1840 and 1.1920, and approaches to the latter are likely to attract selling interest.
Technical levels
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