EUR/USD – Nears 50% Fibo hurdle as risk appetite recovers

Positive action in the FTSE futures and the resulting moderate risk-on in Asia has pushed the EUR/USD pair within a striking distance from 1.1066 (50% of 1.0517-1.1616).

Reduced demand for treasuries

Dollar is on the back foot in Asia as moderate risk-on reduced demand for the safe haven treasuries. In the last two trading days, the greenback was ruling the roost against EUR and other risk currencies as Brexit caught markets by surprise and forced investors to run for a cover under the safe haven treasuries.

However, the positive action in the FTSE futures has pushed treasury yields higher (prices lower). Thus, EUR/USD managed to regain bid tone and recovery from the low of 1.1010 to trade around 1.1060 levels.

EUR/USD Technical Levels

The immediate hurdle at 1.1066 (50% of 1.0517-1.1616) if breached would expose psychological hurdle at 1.11. A break higher could yield 1.1131 (June 16 low). On the other hand, a breakdown of support at 1.1010 (Asian session low) would open doors for a slide to 1.0971 (previous day’s low). A violation there could yield 1.0937 (61.8% of 1.0517-1.1616).