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USD Surge Puts EUR/USD Further Through Base of Bull Channel

EUR
  • EUR/USD selling bias persists through the London close, with the pair hitting new pullback lows and the lowest level since early June. This puts the pair further through key support at 1.0784, the base of the bull channel drawn from the Mar 15 low and represents a key pivot point - a clear channel breakout here would strengthen bearish conditions and open 1.0668 next, the Jun 7 low.
  • The backdrop remains yield-driven, with the return higher for US 10y yields accelerating on hawkish tones from Fed's Mester as well as the solid factory orders release for July, which could feed further into near-term economic momentum, for which markets watch tomorrow's scheduled update of the AtlantaFed GDPNow estimate (last 5.6% annualized on Friday).

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