EUR/USD dips despite losses in the treasury yields

EUR/USD clocked a session low of 1.0774 this Monday morning, despite the dismal US wage growth numbers released on Friday and the resulting losses in the treasury yields.

Stuck between 5-DMA and 100-DMA

At the time of writing, the spot was trading around 1.0780. The 5-DMA stands at 1.0777 and the 100-DMA is at 1.0798. Friday’s recovery from the low of 1.0709 ran out of steam around 1.08 handle.

Treasury yields drop

The 10-year treasury yield was last seen trading 3.6 basis points lower around 2.455. The 2-year yield, which mimics short-term rate hike bets, shed two basis points. The losses could be explained by Friday’s report, which showed a slack in the labor market and a slowdown in the wage growth in January.

Despite this, the EUR/USD suffered moderate losses in Asia. Ahead in the day, EUR side of the story could be influenced by German factory orders data, Eurozone Sentix Investor Confidence figure and ECB President Mario Draghi’s speech.

EUR/USD Technical Levels

A break above 1.0798 (100-DMA) could yield a re-test of 1.0829 (Feb 2 high), above which Oct 25 low of 1.0851 could be put to test. On the other hand, a breakdown of support at 1.0756 (Feb 2 low) would expose 1.0742 (10-DMA) and 1.0709 (Friday’s low).