- EUR/USD is heading into European session 0.15 percent higher.
- European desks may put a strong bid under the EUR, tracking the slide in the treasury yields and the rise in the Chinese yuan.
- The falling Italy-German yield spread also favors upside in the EUR.
The EUR/USD could challenge a key resistance at 1.1402 today, tracking the slide in the 10-year treasury yield and the rise in the Chinese yuan – an anchor for global markets.
The common currency scored marginal gains in Asia as the benchmark US Treasury yield fell below the 200-day moving average (MA) of 2.96 percent – its first drop below the long-term average since November 2017.
Notably, the 10-year treasury yield risks falling further as indicated by the double top breakdown, confirmed last week.
Further, Chinese yuan (CNY) fell to 6.8357 in Asia – the lowest level since Sept. 21 – and could slide further to 6.80. The common currency has been closely following the action in the Chinese yuan off late.
As a result, the bullish move in the EUR/USD could gather pace in Europe, all the more so, as the Italy-German 10-year bond yield spread continues to fall, signaling easing concerns about Italy's fiscal issues.
The spread fell to 283 basis points yesterday, the lowest since Oct. 3 and could slide further, having suffered a double top breakdown on Friday.
EUR/USD Technical Levels
Today Last Price: 1.1378
Today Daily change: 33 pips
Today Daily change %: 0.291%
Today Daily Open: 1.1345
Previous Daily SMA20: 1.1357
Previous Daily SMA50: 1.1443
Previous Daily SMA100: 1.1527
Previous Daily SMA200: 1.176
Previous Daily High: 1.1382
Previous Daily Low: 1.132
Previous Weekly High: 1.1402
Previous Weekly Low: 1.1267
Previous Monthly High: 1.15
Previous Monthly Low: 1.1216
Previous Daily Fibonacci 38.2%: 1.1343
Previous Daily Fibonacci 61.8%: 1.1358
Previous Daily Pivot Point S1: 1.1316
Previous Daily Pivot Point S2: 1.1287
Previous Daily Pivot Point S3: 1.1254
Previous Daily Pivot Point R1: 1.1378
Previous Daily Pivot Point R2: 1.1411
Previous Daily Pivot Point R3: 1.144