EUR/USD: Bears extend control post-Macron win, targets 1.0900?

The selling interest behind the Euro gathered pace in the European session, knocking-off the EUR/USD pair to fresh session lows of 1.0938, almost down 100-pips from multi-month tops reached at 1.1022 in early Asia.

After having clocked six-month tops earlier on the day, the spot is on a retreat and now looks to test 1.09 handle amid extension of a profit-taking slide post Macron-win rally. The European traders adopt the ‘Sell the fact’ strategy and dump the Euro, as a Macron-victory in the French presidential election was already priced-in by the markets.

Adding to the sell-off in EUR/USD, the German10-year yields dive deeper into the red, tracking the yields in the French money markets. Meanwhile, markets ignored upbeat Eurozone Sentix Investor Confidence data, as Macron trade unwinding dominates the fx space.

Focus now shifts towards the US LMCI data due later in the NA session for fresh momentum. However, the Euro may remain under pressure in the day ahead, in the wake of a similar reaction (as seen in Europe so far) from the US traders to the French election news.

EUR/USD Technical Levels

Valeria Bednarik, Chief Analyst at FXStreet explains, “Technically, the 4 hours chart shows that the 20 SMA heads north around 1.0950, former yearly high, whilst a strong Fibonacci support stands at 1.0930. Technical indicators in the mentioned time frame are heading lower within positive territory, rather reflecting the ongoing retracement than suggesting bearish strength. Below 1.0930, however, further declines become more likely, with 1.0890 and 1.0850 as the next intraday supports.

To the upside, 1.0985 is the immediate short term resistance, followed by the mentioned daily high at 1.1020,” Valeria adds.