September 21, 2022 17:23:27
The Euro plunged nearly 1% after Russian President Vladimir Putin announced a military mobilization in Russia for the first time since World War two that could escalate tensions with Ukraine. Further, the President’s remarks on the readiness to use Nuclear weapons spooked the markets further.
Investors flew to safe-haven assets—the U.S. dollar hit 111.00, the levels last visible in June 2002. In addition, another supersized rate hike expectation from Federal Reserve also played its role.
The Eurozone is already struggling with sky-high inflation and stretched labor market conditions. An energy crisis owing to the ongoing war between Ukraine and Russia crippled the economy further. There is no surprise that the shared currency fell toward fresh yearly lows.
Euro has failed to take any meaningful benefit from an increasingly hawkish European Central Bank (ECB). Meanwhile, ECB President Christine Lagarde stated on Tuesday that policymakers would continue to raise interest rates over the next meetings to tame the surging inflation, even if it means restricted economic growth.
EUR/USD bears eyes for 0.9800
Technically speaking, the EUR/USD offers no excitement for the bulls. In fact, more downside could be expected further. The pair remains offered at every key resistance level. The pair met the support emerges at the start of the month near 0.9865. The sellers could enjoy further slide as the pair trades below the critical 20-day and 50-day EMAs.
The formation of two red candles points to the continuation of the downside momentum. A daily close below the mentioned level would amplify the selling pressure. On moving down, immediate support is located at 0.9800.
The upside is capped at the 20-day EMA at 1.0004.