Jul 11, 2022 03:54 AM ET
By: AnalysisWatch
The European currency comes under renewed and quite strong downward pressure and pulls EUR/USD back toward the 1.0100 region on Monday.
EUR/USD is on the defensive at the beginning of the week, posting losses for the third week in a row against the backdrop of the U.S. dollar, which is strengthening strongly again.
Further gains in the greenback are accompanied by expectations of a continuation of the Federal Reserve's rate hike cycle after the US labor market data for June (+372,000 jobs) was again very good. At the same time, these results seem to have softened the excitement about a possible "hard landing" of the U.S. economy.
In the German money market, yields on 10-year bunds fell somewhat on Monday in line with developments in the U.S. bond market.
So far, it is 0.76% lower at 1.0108, facing resistance at 1.0071 (2022 low of July 8), 1.0060 (low of December 11, 2002) and finally 1.0000 (psychological mark). On the upside, a break above 1.0528 (55-day SMA) would target 1.0615 (weekly high of June 27) en route to 1.0773 (monthly high of June 9).
Key events in the euro area this week: Germany, EMU ZEW Economic Sentiment (Tuesday) – Germany Final Inflation Rate, EMU Industrial Production (Wednesday) – EMU Balance of Trade (Friday).