FXStreet (Mumbai) - EUR/USD extends its bearish momentum as we progress towards mid-Asia, with the renewed buying interest seen in the US dollar knocking-off the major to fresh multi-month troughs.
EUR/USD: April lows now in sight
Currently, the EUR/USD pair trades -0.40 lower at fresh seven-month lows of 1.0601, having breached Wednesday’s highs at 1.0615. The offered tone around EUR/USD keeps growing bigger, as the US dollar keeps garnering strength on the back of the latest chatter that the Fed is set to hike the discount rates at its mysterious announcement due later today. Markets are thus pricing-in a Fed rate hike next month and propping up the buck across the board.
The latest Fed chatter adds to the growing monetary policy divergence between both continents, with the ECB further stimulus measures almost a done deal at its Dec meeting. In the week ahead, the EUR calendar remains data-quiet and therefore, the focus now remains on a host of key US macro data including the core durable goods and prelim GDP.
Meanwhile, a series of flash manufacturing and services PMI from the Euro area will be reported ahead of the manufacturing and existing home sales data from the US due for release later today.
EUR/USD Technical Levels
The pair tests 1.06 handle, with the immediate support seen at 1.0519 (April lows), below which a test of 1.0460 (yearly low) is now inevitable. While to the upside the next hurdle in sight is located at 1.0646 (Daily high) and from there to 1.0663 (5-DMA).
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