EUR/USD rejected at 1.0600, reverts to daily lows ahead of GDP

The steady recovery seen in the EUR/USD pair so far this session ran into fresh sellers queued up at 1.06 handle, knocking-off the rate sharply lower in a bid to test daily lows reached in early Asia at 1.0573.

The latest leg lower in the major can be mainly attributed to a pick-up in buying interest seen around the US treasury yields as risk-off trades ease a bit. Hence, the US dollar jumped back on the bids against its main competitors, with the USD index finally breaking higher to 101.75, daily tops.

Meanwhile, the euro failed to benefit from the cross-driven strength, as the EUR/GBP cross remains strongly bid amid fresh losses in cable. EUR/GBP rises 0.20% to 0.8666, having posted daily highs at 0.8678.

Markets now eagerly await the Eurozone revised GDP print, as a positive surprise could offer some support to the EUR. Earlier on the day, the German factory orders data showed a bigger-than expected drop, and fell to the lowest levels in eight years.

EUR/USD Technical Levels

Valeria Bednarik, Chief Analyst at FXStreet noted, “The EUR/USD pair technical picture is neutral-to-bullish as long as the price remains above 1.0565, a major Fibonacci support, with the 20 SMA in the 4 hours chart now converging with it and reinforcing the static support. In the same chart, however, technical indicators are losing their upward strength and turning south within positive territory, indicating limited buying interest.

The key resistance continues to be the 1.0630 region, as the pair has been steadily rejected on attempts to break higher for the past three weeks. If the level is cleared, 1.0660 and 1.0710 are the next short term resistances. Below the mentioned 1.0565, the pair has supports, and possible,”Valeria added.