Euro remains offered and drops to new yearly lows near 1.0460

• The Euro succumbs to further US Dollar’s strength.
• Stocks in Europe open Monday’s session on the defensive.
• EUR/USD retreats to new 2023 lows around 1.0460.
• The USD Index (DXY) advances to fresh tops north of 107.00.
• JOLTs Job Openings will take centre stage later in the session.

The Euro (EUR) accelerates its losses against the US Dollar (USD), dragging EUR/USD to the area of new YTD lows around 1.0460 on Tuesday.

In the meantime, the march north in the Greenback remains everything but abated for yet another session, navigating past the 107.00 hurdle when measured by the USD Index (DXY) for the first time since late November 2022. It is worth noting that the index has entered its 12th consecutive week of gains.

The monetary policy outlook remains unchanged, as investors maintain their expectation of a 25-bps interest rate hike by the Federal Reserve (Fed) before the year concludes. Simultaneously, market discussions persist regarding a potential halt in policy adjustments at the European Central Bank (ECB), despite inflation levels surpassing the bank's target and growing concerns about a potential recession or even stagflation in the region.

The lack of data releases in the domestic docket leaves attention to the publication of the JOLTs Job Openings for the month of August and the IBD/TIPP Economic Optimism index.

Daily digest market movers: Euro remains well under pressure on USD-buying

• The EUR extends the retracement vs. the USD.
• US and German yields appear slightly bid so far on Tuesday.
• Markets anticipate one further rate rise by the Fed before the end of the year.
• Investors anticipate a stalemate in the ECB's tightening drive.
• The RBA left the OCR unchanged at 4.10%, as expected.
• Concerns about FX intervention remain strong around USD/JPY.

Technical Analysis: Next on the downside emerges 1.0290

EUR/USD faces increasing selling pressure and prints new lows for the year in the 1.0460/55 band on Tuesday.

On the downside, the continuation of the downward should prompt EUR/USD to meet the next support at the round level of 1.0300 prior to minor support at the weekly lows of 1.0290 (November 30 2022) and 1.0222 (November 21 2022).

In case of occasional bullish attempts, the pair should encounter the next up-barrier at the weekly high of 1.0767 (September 12), before reaching the crucial 200-day SMA at 1.0825. If the pair breaks beyond this level, it may set up a challenge of the weekly top at 1.0945 (August 30) and the psychological barrier of 1.1000. The surpass of the latter might prompt the pair to test the August peak of 1.1064 (August 10) ahead of the weekly high of 1.1149 (July 27) and the 2023 top of 1.1275. (July 18).

However, it is critical to remember that as long as the EUR/USD remains below the 200-day SMA, the possibility of more negative pressure exists.