EUR/USD breaks under 1.1100 as DXY hits weekly highs

The EUR/USD continued to decline after the beginning of the American session and fell to 1.1085, reaching the lowest level in a week. As of writing, t  |  17/01/2020 16:35
  • EUR/USD falls to test last week highs, ends week under pressure.
  • US Dollar Index breaks above 97.60 to highest since December 26. 

The EUR/USD continued to decline after the beginning of the American session and fell to 1.1085, reaching the lowest level in a week. As of writing, trades at 1.1090, down 45 pips for the day. 

The slide of the euro found support just one pip above the last week low. If it drops under 1.1083 it would be trading at the weakest level in three weeks. 

A stronger US Dollar across the board pushed EUR/SD lower. The DXY broke above 97.60 and reached at 97.65, levels not seen since December 26. It remains near the top, firm above last week highs. 

The US dollar is rising particularly against majors and keeps the bullish perspective even after lower than expected economic data from the US. Also US yields move of highs having no impact on USD strength on Friday. 

Technical outlook 

The EUR/USD is about to post the third weekly decline in a row but still holds above the 1.1060/70 area. The mentioned is a relevant zone in the weekly chart: a horizontal level and also the 20-week moving average. 

“The pair is battling with a daily ascendant trend line coming from November 29 low at 1.0980, and not far above January’s low at 1.1084. The weekly chart shows that the pair held above the 20 SMA but far below the larger ones, while technical indicators turned south, currently within neutral levels”, explained Valeria Bednarik, Chief Analysts at FXStreet. 

The risk remains skewed to the downside, with the January low at 1.1084 providing immediate support ahead of the 1.0980 level, adds Bednarik. According to her, under 1.0980 the next possible bearish target is the 1.0900/20 price zone.

 

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