TECHNICAL ANALYSIS

Dollar companies continue session as risk aversion deepens


EUR / USD slips to session low of 1.1731

European stocks hit new session lows, with the DAX now seen down 2.4% while US futures are also posting new lows of just over 1%.

As a result, the dollar remains firmer across the board, with gold also falling to a low of $ 1,945 – down 1% – and silver nearly 4% again currently.

For the case of EUR / USD, this brings attention back to the short-term chart:

EUR / USD D1 30-07
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Buyers saw the recent bullish momentum stagnate around 1.1700 levels this week and the downward push today calls into question the short term trendline support at 1.1735 now. Just below is the 100 hour MA (red line) at 1.1721.

These will be the key levels to watch in case the dollar starts to gain momentum before the weekend. The short term chart of gold is also to be considered with the 100 hour moving average estimated at around $ 1,940.

Break below these levels and sellers will regain more control in the short term by shifting the more bullish bias seen in both EUR / USD and Gold now to be more neutral instead.

Elsewhere, Treasury yields continue to be a key point to watch and today 10-year yields are still falling to 0.55%. The April low was 0.539% and a break below that could trigger a new wave of risk averse and yen buying flows.

USGG10YR

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