EUR/USD Sub-$1.0750

EUR/USD sits below $1.0750 for the first time since late March, operating just off worst levels of the session, printing $1.0735. Support at $1.0737, which represents a Fibonacci retracement, has been broken, switching bearish focus to $1.0713, the Mar 24 low. Beyond that, support is located at $1.0653, which represents a Fibonacci level. Bulls need to reclaim firm resistance at $1.0874, the 20-day EMA, to start turning the technical tide in their favour.

• Downside economic surprises in the Eurozone (Citi’s Eurozone economic surprise index sits at levels not seen since the initial fallout from the first round of COVID outbreaks in ’20), spill over from the well-documented worry re: the Chinese economic slowdown and a removal of a sizable portion of the cuts priced into the FOMC-dated OIS strip during the remainder of ’23 have weighed on the pair in recent weeks.
• Another raft of ECB speak dominates the Eurozone docket today. We have already seen Slovenian central bank chief Vasle reiterate the need for continued policy tightening, albeit at a slower pace.