The technical bias in EUR/USD favours the dollar currently
The pair is keeping in a relatively narrow range today, but is sitting lower at around 1.0830 – testing support from the 61.8 retracement level @ 1.0838 and also close to the lows posted yesterday at 1.0821.
The break below the 200-hour MA (blue line) was crucial to see the downside momentum extend, as now sellers are also in near-term control after having already broken below both the key daily moving averages above 1.1000 earlier in the week.
The 1.0800 level will present a key challenge for the pair but ultimately, the risk mood will be a key driver of sentiment since it will also impact the greenback.
If the market continues to adopt a heavy risk averse tone, the dollar should see reason to gain further against the euro with the pair likely to look for a firm break below 1.0800.
Once the figure level gives way, a retest of the end-March lows around 1.0636-50 will be on the cards but just be mindful of potential Fed intervention.