EUR/USD tumbles to fresh 2018 lows near 1.270

• The pair stays depressed and prints yearly lows near 1.1270.
• The greenback moves higher to the vicinity of 97.40.
• Brexit talks and Italy remains in centre stage.

 The selling pressure around the European currency is now picking up pace and is forcing EUR/USD to print fresh YTD lows in the boundaries of 1.1270.

EUR/USD look to Brexit, Italy

The pair is extending the negative stance at the beginning of the week, retreating for the fourth day in a row after being rejected from the 1.1500 neighbourhood on last Wednesday.

The Brexit negotiation continues to drive the sentiment surrounding the risk-associated assets along with Italian politics.

In this regard, markets keep looking to PM May’s government, which is expected to submit a draft withdrawal at some point during the week, although the backstop solution for the Irish border still remains unsolved.

In Italy, the government should re-submit a revised version of the 2019 draft budget to the EU Commission, although optimism on a deal remains low (if any at all).

In the data space, Italian Industrial Production will be the only release in Euroland, whereas nothing is scheduled across the pond.

EUR/USD levels to watch

At the moment, the pair is down 0.51% at 1.1278 and a break below 1.1269 (2018 low Nov.12) would target 1.1188 (61.8% Fibo retracement of the 2017-2018 up move) en route to 1.1118 (low Jun.20 2017). On the upside, the next hurdle emerges at 1.1369 (10-day SMA) seconded by 1.1419 (21-day SMA) and finally 1.1502 (high Nov.7).