EUR/USD hits fresh eight week lows near 1.1660 on US dollar strength
- US dollar strengthens further as Wall Street turns negative.
- EUR/USD extends slide, heads for lower close in two months.
The EUR/USD is falling for the fourth consecutive day on Wednesday and recently dropped to 1.1662, the lowest level since July 27. It remains near the lows, under pressure as the US dollar strengthens and risk sentiment deteriorates.
The US dollar, measured by the DEXY jumped to 94.30 reaching the highest level since July. It gained momentum after the beginning of the American session and despite US economic data and Powell’s testimony. Many Fed’s officials spoke on Wednesday highlighting the need for more fiscal stimulus in line with Powell’s comments.
The deterioration in risk sentiment is again boosting the greenback. The Dow Jones is falling 0.25% after being unable to hold into positive territory while the Nasdaq drops more than 1%.
The euro is about to post the lowest close versus the US dollar in two months and is also lower on Wednesday against the pound. European’s PMI failed to lift the common currency.
The daily chart in EUR/USD shows the 20-day simple moving average turning south and indicators favouring the downside. Support levels might be seen at 1.1600 followed by 1.1570 and then comes the strong 1.1500 barrier. On the upside, the immediate resistance might lie at 1.1720 (American session high), 1.1750 and then 1.1825.