EUR/USD bounces off 1.1600 as US elections rekindle blue wave hopes

• EUR/USD trims early-Asian losses, recovers from the late-July lows.
• Global markets reassess odds of Trump’s victory, stocks, bond yields recover.

EUR/USD picks up bids near 1.1660, off more than three-month low, amid the latest pullback moves during early Wednesday.

The major pair initial slumped as the US dollar marked across the board recovery on receding hopes of a blue wave in America, a condition where Democrats dominate the Congress. However, recent updates suggest that President Donald Trump’s victory is also unsure.

As a result, S&P 500 Futures bounce back from the negative region to gain over 1.8% whereas the US 10-year Treasury yields take a U-turn from 0.80% by press time. Hence, the US dollar index (DXY) also eases from the fresh high since September 28 to 93.91 by the time of writing.

Global markets remain sensitive to the US election updates and hence a proper caution should be checked before trading the volatile markets.

Check live updates: Four more years for Trump or a victory for Biden? – Live coverage

Technical analysis

A clear break below the 1.1600 threshold can confirm the bearish moves, until then challenges to the 50-day SMA level of 1.1780 can’t be ignored.