EUR/USD rejected at 100-DMA, flirting with lows near 1.06 handle

The EUR/USD pair once again failed to build on to its momentum and ran through fresh offers at 100-day SMA hurdle near the 1.0625-30 region.

The pair's latest leg of downslide in the past couple of hours could be attributed to a modest recovery in the US treasury bond yields, which extended some immediate support to the greenback and helped the key US Dollar Index to reverse early losses to mid-100.00s. 

Meanwhile, comments by IMF's Lagarde that the IMF is still debating on whether to give some lending to Greece might have also prompted traders to initiate some fresh short positions, against the backdrop of uncertainty surrounding the French Presidental election. 

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From a technical perspective, the pair failed to build on the ongoing recovery move and faced rejection near 100-day SMA for the second consecutive session. Hence, a decisive break below the 1.0600 handle would confirm bearish bias and turn the pair vulnerable to extend its near-term downward trajectory.

Technical levels to watch

A decisive break through the 1.0600 handle, leading to a subsequent drop below 1.0575-70 support area, would turn the pair vulnerable to aim towards the key 1.05 psychological mark with some intermediate support near 1.0540-35 zone. 

On the upside, 1.0625-30 region (100-day SMA) remains immediate strong hurdle, which if conquered might trigger a short-covering rally towards 1.0675-80 horizontal resistance ahead of 1.0700 round figure mark.