EUR/USD offered at 5-DMA, targets 1.1000 ahead of US data

The recovery in the EUR/USD met fresh supply at 5-DMA, with the bears knocking-off the rate sharply lower over the last hour, in an attempt to retest 1.1000 – key psychological levels ahead of the much-awaited US macro data.

EUR/USD trades below all major DMAs

Currently, EUR/USD drops -0.27% to 1.1028, have posted fresh session lows at 1.1024 some minutes ago. The main currency pair came under aggressive selling pressure last hours after the US dollar picked-up significant strength against its major rival, mainly driven by a sharp rally in the US treasury yields, which suggest that a Fed rate hike in Dec is almost confirmed.

Meanwhile, the US dollar index jumps +0.28% to fresh session highs of 97.82, heading back towards fresh seven-month highs of 98.12 reached a day before.

The main focus today will be on the US retail sales, Fed speaks and US bank earnings from Citi, JP Morgan and Wells Fargo, which will be reported later in the NA session. In the meantime, markets closely track the RO-RO trends and look forward to the Eurozone trade report due for release in the European session ahead.

EUR/USD Technical Levels

In terms of technicals, the pair finds the immediate resistance 1.1058 (5-DMA). A break beyond the last, doors will open for a test of 1.1082 (daily R1) and from there to 1.1100 (round number). On the flip side, the immediate support is placed at 1.1000 (round figure) below which 1.0985 (3-month low) and 1.0959 (Jul 27 low) could be tested.