EUR/USD fails to hold to gains and retreats below 1.0600

EUR/USD pulled back during the American session and erased daily gains, falling back into negative territory for the week. The pair failed to hold above 1.0600 and dropped to 1.0565. 

The decline from 1.0617 found support around the 1.0560/65 zone. Currently it trades at 1.0570, 40 pips below the level it closed last week. The euro is headed toward the third weekly decline a row as the US dollar recovers and the euro remains weak amid political uncertainty in Europe. 

Analysts from Danske Bank expect the US dollar to remain supported by Donald Trump and Federal Reserve policies near term, while they see EUR/USD heading higher beyond a period of three months. 

EUR/USD technical levels 

The pair today failed to hold above a short-term downtrend that stands around 1.0595 and pulled back, signaling that the bearish momentum could still prevail. The immediate support could be seen at 1.0520 and below here at 1.0495 (weekly low). 

 A consolidation on top of 1.0600 could remove strength out of the US dollar and favor a recovery of the pair. The next resistance on top could be seen at  1.0630 followed by 1.0650 (20-day moving average).