EUR/USD rebounds back above 1.1100 from fresh weekly lows
- Higher US yields and stronger US dollar keep EUR/USD under pressure.
- DXY up for the third day in a row, at highest since December 27.
The EUR/USD pair dropped further during the American session, hitting a fresh weekly low at 1.1091. Then it rebounded and as of writing, it trades at 1.1105, modestly lower for the day, about to post the third decline in a row.
The bearish pressure looks alleviate in EUR/USD but the bias still points to the downside. Price action across financial markets remains limited on Thursday, after days of volatility on the back of Middle East tensions.
Today, Wall Street indexes are up again, at record highs and US yields are also sharply higher. The 10-year yield rose to 1.90%, and is back to the level it had on January 2. Two days ago the yield hit 1.71%.
The greenback looks stronger as markets stabilized ahead of the NFP report. The US Dollar Index is up for the third consecutive day, trading back above 97.50.
Short-term outlook
So far, EUR/USD moves in a 30 pips range on Thursday, showing no clear signs. It still looks bearish but the momentum eased. Price action is likely to remain limited ahead of the Asian session unless some breaking news triggers volatility.
On the upside, at 1.1110 the 20-hour moving average is the immediate resistance followed by the daily high at 1.1120. Then comes the 1.1140 area. On the flip side, a consolidation under 1.1100 would likely increase the bearish pressure. The next support might lie at 1.1075/80 that protects the 1.1065 barrier.