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EUR/USD: Weaker in Asia, eyes Wednesday’s low

FXStreet (Mumbai) - EUR/USD kick-off the week on a weaker note, extending its recent bearish momentum to trade near multi-month lows ahead of 1.06 handle.

EUR/USD trades below all major DMAs

Currently, the EUR/USD pair trades -0.07 lower at 1.0639, within a shouting distance of the fresh seven-month lows struck at 1.0615 on last Wednesday. The shared currency remains pressured against its American counterpart as markets have almost priced-in a QE expansion/extension by the ECB as we step into the last week before their Dec 3 meeting.

Moreover, the recent streak of weak Euro zone economic data only suggests a weak recovery while Friday’s comments by ECB Chief Draghi, reiterating that the central bank is ready to do more if needed, further adds to the ongoing euro weakness.

While on the other side of Atlantic, the Fed remains set to raise rates next month with the upcoming NFP report next week to further confirm such a move. While the week ahead holds the key durable goods orders and prelim GDP from the US in a run up to the Fed Dec 17 showdown.

In the day ahead, a series of flash manufacturing and services PMI from the Euro area will be reported along with the manufacturing and existing home sales data from the US, which is likely to have major impact on further USD moves.

EUR/USD Technical Levels

The pair trades just ahead of 1.06 handle, with the immediate support seen at 1.0615/00 (Nov 18 Low/ round number). Selling pressure will intensify below the last, dragging the pair towards 1.0519 (April lows). While to the upside the next hurdle in sight is located at 1.0663 (5-DMA) and from there to 1.0695 (1h 50-SMA).

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