EUR/USD reverses and prints fresh lows under 1.1380

• DXY bounces back above 96.00 turns positive again.
• EUR/USD fails to hold above 1.1400, uptrend losing momentum.

The EUR/USD pair extended the retreat from 1.1440 and dropped to 1.1374, hitting a fresh two-day low. Near the end of the American session, it is hovering near the bottom, with increasing short-term bearish signs.

Little attention to US data, ECB

Economic reports from the US on Thursday included Jobless Claims and a positive surprise from Retail Sales. Those numbers failed to boost the greenback. They were mostly ignored.

In the Eurozone, the European Central Bank, as expected, kept the monetary policy stance unchanged. The outcome of the meeting had no lasting impact on the euro. “The central bank still stands ready to act if this is needed, but first the Governing Council is looking for further evidence on the strength and speed of the economic recovery. We continue to see risks tilted to further accommodation, with another (smaller) increase in the PEPP as a likely response. This can probably wait until Q4, when more is known about the state of the economic recovery”, explained analysts at Rabobank.

During the American session, the EUR/USD pulled back amid a stronger US dollar across the board. The DXY rebounded to 96.30, sending the pair again under 1.1400. The move extended to 1.1375. From a technical perspective, indicators show bearish signs ahead of the Asian session. Short-term moving averages are starting to turn south. A steady recovery back above 1.1405 would negate the bearish momentum.

Data to be released on Friday includes Eurozone CPI and housing numbers in the US. Both reports are unlikely to impact on the EUR/USD. Attention will likely focus on the special European Union summit to discuss the budget and the recovery fund.

Technical levels