Doji Pattern Over 1.2178 Support!
The EUR/USD pair was closed at $1.2190 after placing a high of $1.2263 and a low of $1.2182. EUR/USD pair dropped on Wednesday after placing gains for the previous 2-consecutive days. A come-back in the U.S. dollar drove the slide in the currency pair. The recovery of the U.S. dollar across the board pushed EUR/USD pair to the downside. The U.S. Dollar Index (DXY) bounced and rose to 90.05 and was up by 0.35%. This rebound in the DXY from a multi-month low level took place even as the U.S. yields were moving downside and the equity prices were rising. The benchmark 10-year U.S. Treasury yield stood at 1.55% on Wednesday.
The strength in the U.S. dollar came in after the Fed officials starting giving hints on easing of bond purchases. On Wednesday, the top Federal Reserve official Randal Quarles signaled that he was ready to open talks on reducing some of the U.S. central bank's emergency support for the economy. Quarles noted that he did not expect a round of 1970s-style breakout inflation. He was fully committed to a new Fed strategy that aims to keep the monetary policy running full-throttle while jobs recover. Meanwhile, the U.S-China jitters surrounding trade deal emerged after a report from the U.S. based Peterson Institute for International Economics showed that Chinese purchases were still running short of the agreed amount as the trade deal between the U.S. and China moved into its second year.
On the other hand, the European Union started legal action against the Anglo-Swedish pharma company last month over complaints that AstraZeneca failed to meet its delivery targets with the bloc. However, AstraZeneca has denied these accusations and said that it would strongly defend itself in court. The EU Commission announced a new vaccine deal with Pfizer and BioNtech earlier this month, encompassing about 900 million doses to be delivered between 2021 and 2023. The EU was expecting 120 million doses of the AstraZeneca vaccine in the first quarter, but it only received about 30 million doses.
On Wednesday, a top EU official has dismissed the idea that Brussels could enter into new contract negotiations with AstraZeneca while a court was currently assessing whether the company breached its existing deal to supply coronavirus vaccines. This also added some downward pressure on EUR/USD pair on Wednesday.
EURUSD Intraday Technical Levels
Support Resistance
1.2161 1.2242
1.2130 1.2294
1.2079 1.2324
Pivot Point: 1.2212
EUR/USD - Technical Outlook
The EUR/USD is trading at 1.2198 area, having tested the triple top resistance level of 1.2260. On the 4 hour timeframe, the EUR/USD pair is gaining support at the 1.2178 level, and it has closed a Doji pattern right above this level. The Bullish bounce off over the 1.2178 level leads the pair towards the next resistance area of 1.2250. At the same time, the violation of the 1.2178 level exposes the pair towards 1.2126 and 1.2064 support areas. The overall trading bias is still bearish as the EMA and RSI suggest a selling trend in the EUR/USD pair. All the best!
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