Where is the next stop of EUR/USD

The breakthrough of the technical support for the mid-term movement that we have witnessed in recent months has led to a strong downward momentum for the pair.

An important fundamental factor that also affects the rise of the dollar is the expectations for 3 interest rises until the end of 2018.

The rise in yields on US 10-year government bonds also led to a search for dollars. Withdrawing them from the stock market and redirecting them to the bond market is considered positive for the country's fiscal policy. Increasing state budget will allow the increasing infrastructure and other social spending (construction of schools, hospitals, etc.). The idea is that US investors have not invested their capital in US companies alone, and the withdrawal of capital from a foreign company and the injection of capital into government bonds has generated USD demand.

At the moment, the couple faces another serious support. Main diagonal of upward movement as well as strong horizontal support. However, technical indicators suggest that the downward trend will continue. The CCI (50) is below -100, which is considered a beard-controlled area. RSI goes below level 30, which also indicates that the downward movement is stronger.

Today we expect the data on the country's Gross Domestic Product. If the data are above expectations the strength of the green currency will continue. If the data is higher and visible below the current support zone, the next stop of the pair is about 1.2000, but this level is not so strong.

Read more:

• AUDUSD: key levels where we are looking for short positions
• AUDUSD bounces off the resistance zone despite the positivism during the Asian hours
• EURUSD in a tight range during the Asian session
• EUR in a recovery mode, but vulnerable | Technical levels
• EURUSD continues ranging in the early EU session. NFP data in focus at 15:30