#EURUSD @ 1.06979 has shown a sheer downside below 1.0700 as US Dollar bulls got strength amid hawkish Fed bets. (Pivot Orderbook analysis)
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- EUR/USD has shown a sheer downside below 1.0700 as US Dollar bulls got strength amid hawkish Fed bets.
- Soaring expectations for one more interest rate hike by the Fed might rerate the USD Index ahead.
- The ECB is expected to remain hawkish in June as inflation is extremely diverged from the desired target of 2%.
The pair currently trades last at 1.06979.
The previous day high was 1.0747 while the previous day low was 1.0672. The daily 38.2% Fib levels comes at 1.0718, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.0701, expected to provide resistance.
The EUR/USD pair has delivered a vertical fall and has slipped below the round-level support of 1.0700 in the Asian session. The major currency pair has witnessed immense selling pressure as the US Dollar Index (DXY) has shown a firmer upside after overstepping the crucial resistance of 104.20.
S&P500 futures have posted decent losses in Asia after a rangebound Tuesday, portraying a risk-aversion theme. Investors are dumping risk-sensitive assets amid fresh expectations of an interest rate hike by the Federal Reserve (Fed). The appeal for the USD Index has improved sharply as investors are anticipating a rerating of the dollar basket amid hawkish Fed bets.
However, the demand for US government bonds is consistently increasing as investors are optimistic that the US borrowing cap increase proposal will get passage by Congress before June 05. This has led to a decline in the 10-year US Treasury yields below 3.69%.
Consumer spending that remained resilient in April derailed expectations of a neutral interest rate policy stance by the Fed despite Fed chair Jerome Powell cited that more rate hikes are less appropriate due to tight credit conditions. For now, the focus is shifting toward the United States Nonfarm Payrolls (NFP) data, which will release on Friday.
On the Eurozone front, investors are awaiting the release of preliminary Eurozone Harmonized Index of Consumer Prices (HICP) data, which is scheduled for Thursday. According to the estimates, core monthly HICP is seen expanding by 0.8% at a slower pace than the 1% recorded for April. Annual core HICP is expected to soften marginally to 5.5% vs. the prior release of 5.6%. The headline HICP is seen decelerating sharply to 6.3% against the former release of 7.0%.
However, the European Central Bank (ECB) is expected to remain hawkish in June as inflationary pressures are extremely diverged from the desired target of 2%. Apart from the Eurozone inflation, the speech from ECB President Christine Lagarde will also remain in focus.
Technical Levels: Supports and Resistances
EURUSD currently trading at 1.0699 at the time of writing. Pair opened at 1.0734 and is trading with a change of -0.33 % .
| Overview | Overview.1 | |
|---|---|---|
| 0 | Today last price | 1.0699 |
| 1 | Today Daily Change | -0.0035 |
| 2 | Today Daily Change % | -0.3300 |
| 3 | Today daily open | 1.0734 |
The pair is trading below its 20 Daily moving average @ 1.0859, below its 50 Daily moving average @ 1.0903 , below its 100 Daily moving average @ 1.0816 and above its 200 Daily moving average @ 1.049
| Trends | Trends.1 | |
|---|---|---|
| 0 | Daily SMA20 | 1.0859 |
| 1 | Daily SMA50 | 1.0903 |
| 2 | Daily SMA100 | 1.0816 |
| 3 | Daily SMA200 | 1.0490 |
The previous day high was 1.0747 while the previous day low was 1.0672. The daily 38.2% Fib levels comes at 1.0718, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.0701, expected to provide resistance.
Note the levels of interest below:
- Pivot support is noted at 1.0689, 1.0644, 1.0615
- Pivot resistance is noted at 1.0763, 1.0792, 1.0837
| Levels | Levels.1 |
|---|---|
| Previous Daily High | 1.0747 |
| Previous Daily Low | 1.0672 |
| Previous Weekly High | 1.0831 |
| Previous Weekly Low | 1.0702 |
| Previous Monthly High | 1.1095 |
| Previous Monthly Low | 1.0788 |
| Daily Fibonacci 38.2% | 1.0718 |
| Daily Fibonacci 61.8% | 1.0701 |
| Daily Pivot Point S1 | 1.0689 |
| Daily Pivot Point S2 | 1.0644 |
| Daily Pivot Point S3 | 1.0615 |
| Daily Pivot Point R1 | 1.0763 |
| Daily Pivot Point R2 | 1.0792 |
| Daily Pivot Point R3 | 1.0837 |
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