EUR/USD to stay on the back foot unless the 1.10 level turns into support

EUR/USD has been having a difficult time shaking off the bearish pressure following Wednesday's decline. The pair is to continue to suffer losses as long as 1.10 resistance holds, FXStreet's Eren Sengezer reports.

Near-term technical outlook points to a bearish shift

“IHS Markit will release the preliminary March Manufacturing and Services PMI reports for Germany, the euro area and the US. In case these data show that the war is having a bigger impact on the private sector's business activity in Europe than in the US, EUR/USD could face renewed bearish pressure.”

“Federal Reserve Governor Christopher Waller, Chicago Fed President Charles Evans and Atlanta Fed President Raphael Bostic will speak later in the day. Another leg higher in US Treasury bond yields on hawkish remarks should provide an additional boost to the dollar in the second half of the day and vice versa.”

“1.0960 (static level) aligns as interim support before 1.0940 (Fibonacci 23.6% retracement of the latest downtrend). In case the latter support fails, the pair could extend its slide toward 1.09 (psychological level).”

“Strong resistance seems to have formed at 1.10 (psychological level, Fibonacci 38.2% retracement, 100-period SMA). Above that level, 1.1020 (descending trend line, 50-period SMA) could be seen as the next hurdle before 1.1040 (Fibonacci 50% retracement).”