EUR/USD pressured lower by rising U.S. yields; technicals tilt bearish below key moving averages
EUR/USD pressured lower by rising U.S. yields; technicals tilt bearish below key moving averages
Technical Analysis:
EUR/USD remained under persistent selling pressure during the New York session Wednesday, opening near 1.1325 after trading as high as 1.1345 overnight. The pair subsequently extended losses throughout U.S. trading hours, weighed down by broad-based U.S. dollar buying spurred by a notable increase in U.S. Treasury yields. Further bearish influence stemmed from equity market weakness, falling gold prices, and continued gains in USD/CNH—each factor reinforcing the overall market appetite for the greenback as a haven asset amid risk-off sentiment.
From a technical perspective, EUR/USD is encountering significant near-term bearish signals. The pair tested key technical supports during the session, notably approaching the rising 21-day moving average and daily Ichimoku cloud top, with a session low near 1.1284. Momentum indicators, including daily and monthly Relative Strength Indices (RSI), are trending lower, clearly indicating declining bullish momentum. The inability of EUR/USD to reclaim and hold above the crucial 10-day moving average (currently near 1.1335) further amplifies technical concerns for euro bulls, potentially setting the stage for additional downside pressure.
Looking ahead, immediate downside risks remain elevated if EUR/USD decisively closes below the 21-day moving average (approximately 1.1280–1.1285), as this could trigger deeper declines toward the psychological support at 1.1200. Thursday’s U.S. economic calendar, featuring jobless claims and the second estimate of Q2 GDP, presents additional catalysts. Stronger-than-expected U.S. data could reinforce the recent rally in yields, further boosting the dollar and pressuring EUR/USD toward more critical support at the rising daily cloud base near 1.1225. Conversely, a weaker data outcome might temporarily ease the bearish bias, providing an opportunity for a recovery towards the 10-DMA resistance above 1.1335.