EUR/USD has tumbled below 1.20, hitting the lowest in two months. The US dollar is rising alongside Treasury yields, underpinned by fiscal stimulus hopes and robust US data. The euro is struggling with vaccine concerns.
EUR/USD DAILY CHART – HEAD & SHOULDERS SUGGEST EXTENDED LOSSES COULD BE AHEAD
From a technical perspective, the US Dollar Index (DXY) – which is heavily weighted towards the Euro – appears poised to extend its recent climb from the January low (89.21), as prices breach Ascending Channel resistance and break above the neckline of an inverse Head and Shoulders reversal pattern.
A daily close above the high (91.30) would probably intensify buying pressure and carve a path for price to challenge range resistance at 92.00 .Clearing that opens the door for the index to fulfil the inverse Head and Shoulders' move.
