EUR/USD tumbles to fresh 2018 lows near 1.1760

16 May 2018

  • The firm tone around the buck is weighing on the pair.
  • Spot retreats to levels last traded in late December 2017.
  • US Industrial Production expanded 0.7% MoM in April.

The robust pace of the greenback is now forcing EUR/USD to trade in the 1.1770/60 band, fresh multi-month lows.

EUR/USD weaker on USD-buying

The pair is now intensifying the leg lower, shedding ground for the third session in a row and navigating the area of fresh 2018 lows in the 1.1770/60 band, area last visited in mid-December 2017.

On the other hand, the greenback is extending its rally beyond the 93.60 level when tracked by the US Dollar Index, recording at the same time new 5-month peaks and always underpinned by the better tone in US yields.

In the data space, mixed US housing sector results saw Building Permits contracting less than expected in April at a monthly 1.8%, while Housing Starts dropped 3.7% MoM, missing consensus.

Further US data noted Industrial Production expanded 0.7% inter-month during last month and Manufacturing Production grew at a monthly 0.5%.

EUR/USD levels to watch

At the moment, the pair is losing 0.53% at 1.1776 and a breakdown of 1.1764 (2018 low May 16) would target 1.1718 (monthly low Dec.12 2017) en route to 1.1553 (monthly low Nov. 7 2017). On the upside, the next hurdle aligns at 1.1898 (10-day sma) seconded by 1.1996 (high May 14) and finally 1.2021 (200-day sma).

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