EUR/USD is about to break below the current September low at 1.1735

EUR/USD has fallen to 1.1763 during European trading hours, as local indexes plunged, spurring risk aversion as concerns about economic growth hit the financial world amid a second coronavirus wave in the EU. The pair is ready to pierce the monthly low at 1.1735, Valeria Bednarik, Chief Analyst at FXStreet, reports.

Key quotes

“The sour sentiment is the result of a second coronavirus wave hitting the EU and local lockdowns announced. The sour sentiment was exacerbated by news that a second participant in AstraZeneca trials of a vaccine has developed serious neurological symptoms. German FinMin Scholz said this Monday that German debt will likely reach the 80% of the GDP, and subtly referred to EUR’s appreciation, as he added that the ECB is currently faced with a strengthening currency.”

“From a technical point of view, the 4-hour chart shows that EUR/USD has extended its slump below all of its moving averages, with the 20 SMA extending below the larger ones. Technical indicators head lower, although with uneven strength.”

“The Momentum remains within positive levels, as the pair remains above its monthly low at 1.1736, the immediate support.”