Shinobi - EURUSD: Upside potential seems limited
The EUR/USD pair attracts some buying during the Asian session on Friday and reverses a major part of the previous day's slide to the 1.0685 region, or a three-month low. Spot prices currently trade around the 1.0720 region, up nearly 0.20% for the day, and draw support from a modest US Dollar (USD) weakness, though any meaningful appreciating move still seems elusive.
The USD Index (DXY), which tracks the Greenback against a basket of currencies, pulls back from its highest level since March 9 as bulls opt to take some profits off the table ahead of China inflation data and the G20 leaders summit over the weekend. Apart from this, retreating US Treasury bond yields, along with signs of stability in the equity markets, undermine the safe-haven buck, which, in turn, is seen as a key factor acting as a tailwind for the EUR/USD pair. That said, the prospects for further policy tightening by the Federal Reserve (Fed) should limit any meaningful downside for the US bond yields and the USD.
EURUSD SELL 1.0710 - 1.0720
TP: 1.0690
SL: 1.0750
The USD Index (DXY), which tracks the Greenback against a basket of currencies, pulls back from its highest level since March 9 as bulls opt to take some profits off the table ahead of China inflation data and the G20 leaders summit over the weekend. Apart from this, retreating US Treasury bond yields, along with signs of stability in the equity markets, undermine the safe-haven buck, which, in turn, is seen as a key factor acting as a tailwind for the EUR/USD pair. That said, the prospects for further policy tightening by the Federal Reserve (Fed) should limit any meaningful downside for the US bond yields and the USD.
EURUSD SELL 1.0710 - 1.0720
TP: 1.0690
SL: 1.0750
