Increased selling in US Treasury yields weighed on the US dollar index Thursday, with the 10-year benchmark shaking hands with all-time lows at 1.23%. Optimistic data out of the US – durable goods and pending home sales – failed to offer much respite, with the DXY testing lows at 98.36 and marginally fading daily support priced in at 98.45.
Wednesday had the EUR/USD unchanged at the close of trade in London. A fleeting move north of the 1.09 handle emerged, yet 1.0908 proved challenging to overcome, sending the pair to H4 support at 1.0857. Note 1.09 links with a 38.2% Fibonacci retracement ratio.
The US dollar index, measures the value of the US dollar against a basket of foreign currencies, remained on the backfoot Tuesday, aided by less-than-stellar US consumer confidence, with the unit poised to continue declining until reaching daily support at 98.45.
Europe’s shared currency kicked off the week lower against the buck, pencilling in a decisive opening gap. Early Europe witnessed a run to 1.0805, before spiking to highs of 1.0841 amid a modestly better-than-expected German IFO print.
After toppling the 2016 yearly opening level at 1.0873, channel support, taken from the low 1.1109, welcomed a test last week and held price higher. Producing a hammer candlestick formation (a bullish signal at troughs), the unit now faces 1.0873 as potential resistance this week.
