EUR/USD PRICE ANALYSIS: SELLERS RECLAIM THE 50/100-DMAS AND TEST 1.1300

• The shared currency falls for the second straight day, weighed by geopolitical concerns and US dollar strength.
• The US Dollar Index gained some 0.23% at 96.30, underpinned by higher US Treasury yields.
• EUR/USD is downward biased, emphasized by EUR sellers reclaiming the 50-DMA.

The EUR/USD slides towards the 1.1300 figure amid renewed concerns of a Russian invasion of Ukraine, as risk-aversion gets to the highest level in some time. At the time of writing, the EUR/USD is trading at 1.1304.

As Wall Street closed, equities portrayed a gloomy market mood, except for the Nasdaq Composite, up 0.10%. The greenback ended higher against most G8 currencies in the FX market, boosted by its safe-haven status. The US Dollar Index, a gauge of the buck’s value, advanced some 0.23%, sitting at 96.30.

In the fixed income market, US Treasury yields led by the 10-year T-note rose four basis points, sat at 1.991%, underpinned the greenback, which weighed on the EUR/USD. Those factors, alongside the conflict in eastern Europe, triggered EUR weakness.

EUR/USD PRICE FORECAST: TECHNICAL OUTLOOK

Despite the five-day rally post-ECB’s hold when ECB President Christine Lagarde muted on hiking rates in 2022, the EUR/USD is downward biased. However, the upward move stalled at resistance near the January 13 daily high at 1.1482, followed by last Friday’s drop of almost 100-pips. Furthermore, the EUR/USD got back inside the descending Pitchfork’s channel, and at the same time, EUR sellers reclaimed the 50-DMA.

Therefore, the EUR/USD path of least resistance is downwards. The EUR/USD first support would be 1.1300. Breach of the latter would expose the mid-line between the central-top trendline of Pitchfork’s channel around the 1.1220-30 range, followed by the YTD low at 1.1121 and then central trendline of Pitchfork’s near the 1.1000.