Ichimoku analysis (4-hour chart)
Tenken-Sen- 1.08045
Kijun-Sen- 1.08323
EURUSD traded weak for a second consecutive week and lost more than 250 pips on board-based US dollar buying. US debt ceiling negotiations optimism and the chance of one more 25 bpbs rate hike by the Fed supporting the US dollar index at lower levels. It hits a low of 1.07627 and is currently trading around 1.07835.
According to the CME Fed watch tool, the probability of a 25 bpbs rate hike in June increased to 33% from 10.70% a week ago.
The US 10-year yield trades higher for the past five days on hawkish Fed bets. The US 10 and 2-year spread narrowed to -61.70% from -108%.
The pair trades below short-term 21 EMA, 55 EMA, and long-term (200-EMA) in the 4-hour chart. Any indicative break below 1.07600 confirms intraday bearishness; a dip to 1.0700/1.066 is possible. The near-term resistance is around 1.0800. The breach above targets 1.0850/1.0900/1.09300/1.1000.
Indicator (4-hour chart)
CCI – Bearish
Directional movement index – neutral
It is good to sell on rallies around 1.0800 with SL around 1.0850 for a TP of 1.0750.
