EUR/USD rebounds above 1.2100, looks to snap two-week losing streak
- EUR/USD reversed its course after dropping to 1.2080 area.
- US Dollar Index lost its traction, stays below 90.50.
- Disappointing consumer confidence data from US kept USD's gains limited.
The EUR/USD pair spent the European trading hours in a tight range near 1.2100 but lost its traction in the early American session and touched a daily low of 1.2082. However, the pair staged a rebound into London fix and was last seen trading at 1.2125, where it was virtually unchanged on the day. On a weekly basis, EUR/USD remains on track to close in the positive territory.
Rising US Treasury bond yields provided a boost to the greenback in the second half of the day. With the 10-year US Treasury bond yield rising as much as 2%, the US Dollar Index (DXY) advanced to a daily top of 90.72.
However, after the monthly data published by the University of Michigan showed that the Consumer Sentiment Index declined to 76.2 in February's preliminary reading from 79 in January, the DXY turned south and erased its gains. At the moment, the index is unchanged on the day at 90.42.
EUR/USD technical outlook
Credit Suisse analysts think that the 55-day SMA at 1.2146 and 1.2190 resistance will continue to cap the pair's upside in the near-term.
"Support remains at 1.2113/08 initially, below which is needed to see a minor top complete to add weight to our near-term ranging roadmap for a retreat back to 1.2088, with 1.2046/19 then ideally holding further weakness," analysts added. "A break would raise the prospect of a more protracted corrective phase and further weakness to 1.1978 ahead of a retest of the recent low and 23.6% retracement of the entire 2020/2021 uptrend at 1.1952/45.”
Additional levels to watch for