EUR/USD drops below 1.0700 after Yellen, US data

EUR/USD came under mild pressure and make fresh daily lows as the greenback strengthened on the back of Fed’s Yellen testimony and better-than-expected US data.

While Yellen said Thursday that an increase in interest rates “could well become appropriate relatively soon”, data released minute later helped the case. US consumer price index rose 0.4% in October and 1.6% YoY, versus 0.3% and 1.6% expected respectively. The core CPI rose 0.1% MoM  and 2.1% YoY. Separated data showed housing starts rose 25.5% to a 9-year high of 1.323 million in October.

EUR/USD pulled back from a daily high of 1.0745 and dipped below the 1.07 mark to hit a marginal daily low of 1.0680 in recent dealings. At time of writing, the pair was trading at 1.0687, virtually unchanged on the day.

EUR/USD levels to watch

As for technical levels, next supports are seen at 1.0665 (Nov 16 low), 1.0550 (Dec 2 2015 low) and 1.0500 (Dec 3 2015 low/psychological level). On the flip side, immediate resistances could be found at 1.0759 (Nov 16 high), 1.0850 (Oct 25 low) and 1.0868 (10-day SMA).

To learn more about this topic, check our video analysis:

EURUSD from Tip TV Productions on Vimeo.