The EURUSD has been struggling to consolidate above the $1.08 mark in recent trading sessions. Despite the bullish momentum spurred by negative US labor market data, the currency pair has failed to maintain its position above this key level. The sellers of the single currency have been taking advantage of the shifting balance of risks between the eurozone and the US. With expectations of a June rate cut by the ECB and potential follow-up cuts, the euro is facing strong headwinds in its attempt to rally against the dollar.
Bearish Technical Picture
From a technical standpoint, the EURUSD is currently trading below both its 200-day and 50-day moving averages, with both indicators pointing downward. This bearish bias is further reinforced by the failed attempts of the bulls to break through the resistance at $1.08. The market sentiment is cautious, with buyers showing interest only at lower price levels, such as the recent dip to $1.06. The tug-of-war between the bulls and bears is evident in the balanced positioning of both sides, making it crucial to monitor for the next decisive move in the currency pair.
Key Levels to Watch
In terms of key levels, a breakthrough above $1.0850 could signal a potential rally towards the $1.1050 area and beyond. On the contrary, a drop below $1.0650 may prompt buyers to reassess their positions and target the $1.05 level for support. The battle between the bulls and bears in the EURUSD is at a crucial juncture, with the market eagerly anticipating a clear direction for the currency pair. A significant move of around 1% in either direction could mark the beginning of a sustained trend, shaping the future trajectory of the EURUSD exchange rate.