EUR/USD offered at the trend line hurdle, focus on the OAT-Bund spreads

The EUR/USD pair has been offered at 1.06, which is the resistance offered by the rising trend line drawn from Jan 3 low and the March 2 low.

The currency pair was last seen trading around 1.0585 levels.

Focus on French (OATs) - German (Bunds) spread

With just two weeks to go for French election, the EUR remains at the mercy of the Bund-OAT (Obligations Assimilables du Trésor, which are long term bonds) spread.

The 10-year yield spread was recently as wide as 85 basis points. Widening of the yield spread is likely as France’s presidential race is tightening in its final weeks with a far-left and a conservative candidate narrowing the gap on long-time front-runners Emmanuel Macron and Marine Le Pen.

The Eurozone industrial production data and German Zew survey indices may not have much influence on the EUR pairs, given the focus remains on the yield spread ahead of the French elections.

EUR/USD Technical Levels

A break above 1.06 (zero figure + trendline hurdle) would open up upside towards 1.0625 (100-DMA) and 1.0651 (10-DMA). On the other hand, a breach of support at 1.0569 (previous day’s low) could yield a sell-off to 1.0525 (Mar 9 low) and 1.05 (zero figure).