EUR/USD probes lows near 1.0710 on USD pick up

The now better sentiment around the buck is pushing EUR/USD to re-visit recent lows in the 1.0710 area.

EUR/USD attention to US data, US yields

The pair met increasing selling pressure following a resurgence of the buying interest around the Dollar, bolstered at the same time by a solid performance of yields in the US money market, which are extending the rebound to multi-day peaks.

Higher US yields seem to be reflecting growing inflation expectations in the longer run, keeping alive at the same time the broader reflation trade, which could in turn revert the recent near term down trend in USD.

On the data front, earlier German Consumer Confidence has surprised to the upside for the month of February, while today’s Eurogroup meeting will focus on the Greek bailout. Across the pond, US Initial Claims, Trade Balance figures, New Home Sales and Markit’s Services PMI are all due.

EUR/USD levels to watch

The pair is now losing 0.23% at 1.0726 and a breakdown of 1.0709 (low Jan.25) would open the door to 1.0684 (short-term support line) and finally 1.0614 (20-day sma). On the flip side, the next resistance lines up at 1.0775 (high Jan.24) followed by 1.0798 (high Dec.5) and then 1.0873 (high Dec.8).