Investing.com – After rebounding last Thursday and Friday, without calling into question the underlying downward trend, the EUR/USD pair returned to the downward path on Monday and continued to lose ground this Tuesday morning, with a new annual low at 1.0470.
The Dollar indeed rose significantly yesterday, while Jerome Powell reiterated that the Fed remains committed to fighting inflation. FOMC member Michelle Bowman also spoke yesterday to say that it will “probably be appropriate” to raise rates further, and to “keep them at a restrictive level for some time.”
These hawkish remarks are also in line with a note published by Goldman Sachs (NYSE:GS) yesterday, in which it predicts that the main central banks, including the Fed, will not lower their rates in 2024.
Statistics also played a role in the fall of the EUR/USD on Monday, as the Eurozone manufacturing PMI, just in line with expectations, contrasted sharply with the ISM manufacturing index US much stronger than expected.
US rates also favored the rise of the Dollar, with the 10-year rate reaching a peak of 4.70%, the highest since July 2007. Oil prices, which remain at high levels, are also a factor. bearish for EUR/USD.
Moreover, in a note published yesterday, the Nomura bank highlighted this factor, estimating that the Euro Dollar could return to parity if oil continues to fall .
As for Tuesday, the calendar of important statistics for the EUR/USD pair will be quite light, with only the JOLTS report on US job offers being expected, which will however constitute an interesting prelude to the ADP report ( EPA:ADP) on expected employment tomorrow.
>> See the results of all the important statistics for EUR/USD in real time on the Investing.com economic calendar!
Technical thresholds to watch on EUR/USD
From a technical analysis point of view, the break below the key threshold of 1.05 and the new annual low constitute major bearish signals .
If the decline continues, the next support to consider will be the psychological threshold of 1.04. On the upside, 1.05 and 1.06 are the first potential obstacles, before graphic resistance at around 1.0635.
EUR/USD collapses to a new annual low, an avalanche of bearish factors