As it is with some other risky assets currently experiencing downtime, so it is with EUR/USD. And so far in today’s trading session, the market is experiencing significant selling pressure, which is causing the EUR/USD to lose more ground and break through the crucial support level around 1.0900.
The market hits its month high yesterday June 22 reaching the critical 1.1000 mark, but the pair has lost so far more than a cent critical 1.1000 mark, the pair has lost so far more than a cent.
The Fundamental Outlook on EUR/USD
In fact, the euro’s drop was made worse as a result of June’s subpar advanced Manufacturing and Services PMI readings in Germany and France, which in turn rekindled recession fears in the area.
On the other hand, the USD Index (DXY) rises to new highs just above the 103.00 barrier, supported by the risk complex’s negative bias and the Federal Reserve’s speakers’ consistent hawkish rhetoric, notably that of Chief Jerome Powel.
In light of growing rumors of an economic slowdown on both sides of the Atlantic, the Federal Reserve and the European Central Bank’s likely next steps in normalizing their monetary policies are at the center of the macroeconomic discussion.
The Technical Outlook on the Market
After hitting the monthly high of $1.1000, the market began to decline such that the $1.09000 price level could not block the bear market. This current bear market exposes the pair to the risk of falling back to $1.0678, which is the support level between late May and early June. And if the bulls did not regain the upper hand, March’s low of $1.05383 might be the last line of defense for the bulls. However, for now, the market is still above the 20-day moving average, so the bulls are still in the game.
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