EUR/USD retreats in Asia as treasury yields rise

EUR/USD pair is trading on the backfoot in Asia around 1.1044 as the uptick in the treasury yields kept US dollar well bid.

Eyes US data and Yellen speech

US data is likely to show consumer spending as represented by retail sales rose in September. Meanwhile, Michigan Confidence is seen rising as well.

The data release would be followed by Fed’s Chair Yellen speech. For the first time this year, there seems to be a consensus among the Fed policymakers that rates could be hiked in December. Yellen too could chip in today with similar comments, thus cementing Dec rate hike expectations.

In European session, the pair could take cues from US-German 2-year and 10-year bond yield spread.

EUR/USD Technical Levels

A break above 1.1058 (5-DMA) would expose key psychological level of 1.11. A violaton there could yield a test of 10-DMA level of 1.1125. On the lower side, a break below 1.10 handle would shift risk in favor of a drop to 1.0911 (June 24 low). Further losses could run into support at 1.0822 (Mar 10 low).