Ichimoku analysis (4-hour chart)
Tenken-Sen- 1.07672
Kijun-Sen- 1.07140
EURUSD lost its shine on the cautious market mood. Germany's economy revised downward from zero to -0.30% for the first three months of the year. It enters into recession after two successive quarter drops in GDP. It hits a fresh nine-week low of 1.07140 and is currently trading around 1.07278.
US Fed meeting minutes show that Fed members are divided over more rate hikes. Fed officials also mentioned that further rate hikes will be data-dependent.
According to the CME Fed watch tool, the probability of a 25 bpbs rate hike in June increased to 29.5% from 28.40% a week ago.
The US 10-year yield continues to trade higher for the second consecutive week. The US 10 and 2-year spread narrowed to -65.7% 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 1.0850. The breach above targets 1.0900/1.09300/1.1000.
Indicator (4-hour chart)
CCI – Bearish
Directional movement index – Bearish
It is good to sell on rallies around 1.07600 with SL around 1.0800 for a TP of 1.0660.
