EUR/USD drops back towards 1.0860 as USD regains poise

The EUR/USD stalled its steady recovery path in Asian at 1.0880 region, and now reverts towards daily lows of 1.0863 as the European trading gets underway.

EUR/USD: Eyes on EU economic forecasts

The greenback regained poised against its main competitors during the late-Asian trades, now rising back near 3-week tops posted previously at 99.61 levels. Hence, EUR/USD currency faces renewed selling pressure, with the bears now eyeing a test of two-week troughs reached at 1.0851 a day before.

Markets ignored the reports of the director of the Federal Bureau of Investigation (FBI), James Corney, being fired by the US President Donald Trump, and continued buying into the recent US dollar strength amid a rally in treasury yields, as a June Fed rate hike almost looks imminent.

Moreover, ECB President Draghi’s dovish comments delivered yesterday also continues to weigh down on the Euro. Draghi said it’s too early to cheer on bloc’s economic recovery, suggesting that he is in no hurry to raise rates or resort to tapering.

In the day, the major will eagerly await the ECB economic bulletin and EU economic forecasts for fresh impetus amid a lack of economic releases from the Euroland. Meanwhile, from the US, the usual weekly jobless claims and PPI data is slated for release today.

EUR/USD Technical Levels

Valeria Bednarik, Chief Analyst at FXStreet noted, “Technical indicators in this last time frame lack directional strength, but hold near oversold readings, negating the possibility of a recovery in the short term. The immediate support is at 1.0850, followed by a more relevant one at 1.0820, the lowest since the first round of the French presidential election. Should the price break below this last, the next bullish target comes at 1.0730, where the pair will finally close the weekly opening gap left a couple of weeks ago. Support levels: 1.0850 1.0820 1.0770 Resistance levels: 1.0895 1.0930 1.0965”