EUR/USD capped below 1.0700 amid tumbling German yields

Having found support once again near 1.0670 region, the EUR/USD pair is now making another attempt to regain 1.07 handle, but in vain, as ongoing weakness surrounding the German treasury yields continue to keep a lid on the prices.

Safe-havens such as the German bunds and yen remain in demand amid prevalent risk-off market profile, fuelled by North Korean missile launches and pre-Trump-Xi Summit jitters.

Moreover, a series of mixed final services PMI readings from the Euro area also weighs down on the EUR, restricting EUR/USD below 1.07 handle.

The major now awaits the US private sector ADP jobs and ISM non-manufacturing PMI report for fresh momentum. Meanwhile, the FOMC minutes due later in the American afternoon may emerge the main risk event for the spot.

EUR/USD Technical Levels   

Slobodan Drvenica at Windsor Brokers Ltd explains, “Repeated failure to close below 1.0650 Fibo 61.8% support, despite yesterday’s marginally lower low at 1.0634, signal strong hesitation ahead of key supports at 1.0622 (100SMA / daily cloud top). However, bounce was so far unable to clearly break above 55SMA (1.0672), despite upticks to 1.0683 (session high), keeping upper pivot at 1.0700 (daily Kijun-sen) intact for now. Close above 1.0700 is needed to generate firmer bullish signal for stronger correction of the downleg from 1.0905 (27 Mar high).”