- EUR/USD remains close to the 0.9900 barrier.
- Germany’s business climate was unchanged in October.
- US consumer confidence will be in the spotlight later in the session.
The absence of a clear direction prevails around the common currency and makes the EUR/USD is trading with a bearish bias near 0.9860 in the European session on Tuesday.
EUR/USD focuses on risk trends and the dollar
The EUR/USD wobbles once again at key 0.9900 barrier and is under slight downward pressure, all against the background of the lack of a definite trend in the dollar.
The inconclusive price action around the pair is also coming Accompanied by third consecutive fall in German 10-year Bund yieldswhich are around the 2.25% zone so far.
In the German calendar, the pair did not react to the publication of the business climate measured by the IFO Institute, which remained unchanged at 84.3 in the month of October.
On the other side of the Atlantic, the FHFA will publish its home price index ahead of the most relevant data on consumer confidence measured by the Conference Board.
What can we expect around the euro?
EUR/USD is under pressure after another failed attempt to test and break above the 0.9900 level on Tuesday.
Meanwhile, the price action around the European currency is expected to closely follow the dynamics of the dollar, geopolitical concerns and the political divergence between the Fed and the ECB. Following the latest results from key economic indicators, the latter is expected to spread further amid the ongoing resilience of the US economy.
In addition, growing speculation about a possible recession in the region (which seems to be underpinned by the decline in sentiment indicators, as well as the incipient slowdown in some fundamental variables) adds to the sour sentiment around the euro.
EUR/USD levels
At time of writing, the EUR/USD is down 0.02% on the day, quoting at 0.9871. A break of 0.9631 (Oct 13 low), would target 0.9535 (Sep 28 low) on the way to 0.9411 (June 17, 2002 low). On the other hand, the next upside barrier is found at 0.9899 (24th Oct high), followed by 0.9999 (4th Oct high) and 1.0050 (20th Sep high).
Source: Fx Street
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