• EUR/USD makes a run to weekly highs and retreats.
• Pair now closer to the daily low as US yields rise.
• Equity markets turn negative, oil sinks.

The EUR/USD failed to break the current range despite hitting the highest level in 13 days. The pair peaked at 1.0675 and then pulled back. It is trading at daily lows under 1.0620.

The short-lived run to 1.0675 coincided with the US dollar bottoming across the board. Afterwards, boosted by a rebound in US yields. The US 10-year yield rose from 3.82% to 3.87%, a fresh monthly high. Equity prices in the US turned negative adding some support to the greenback. The US Dollar reversed sharply during the last hour. The DXY rose from 6-day lows at 103.84 to 104.42, the strongest since Friday. Crude oil prices are falling by more than 2%. 

Economic data released in the US showed mixed numbers. Pending Home Sales in November dropped unexpectedly by 4% against expectations of a 0.6% increase; compared to a year ago sales are down by 37.8%. The Richmond Fed Manufacturing Index jumped in December to 1 from -9, surpassing the market consensus of -4.

Levels to watch

The EUR/USD was again rejected from the 1.0660/70 area and it reversed. Now it is moving toward 1.0600. A break lower would expose the lower limit of the current range at 1.0580. A consolidation below would point to a deeper correction, with the next support seen at 1.0530.

Technical levels