EUR/USD hits fresh 6-day highs as USD tumbles on tax plan
- USD resumes slide on Senate tax bill.
- EUR/USD bullish momentum reinforced.
- Republican’s plan would delay corporate tax cuts until 2019.
The EUR/USD pair rose quickly to fresh 6-day highs above 1.1650 after the confirmation that Senate Republicans plan to propose delaying tax cuts to corporations until 2019. The plan is against President Trump intentions to make immediate changes.
Senate tax bill to delay corporate tax cut until 2019, dollar to deflate?
The US Dollar Index dropped further and hit a fresh low at 94.33, moving closer to November lows at 94.25, a key technical level. The greenback was recovering modestly but is now again under modest pressure. Gold approached daily highs and the Dow Jones extended losses. The 10-year yield fell from 2.34% to 2.32%.
Technical levels
At the moment of writing, EUR/USD stands at 1.1646, up 55 pips for the day, having the best performance in weeks. It is back above the 1.1620 key area that now is the immediate support. As long as it holds above, the euro would remain supported.
The next target to the upside might be seen at 1.1660 (Oct 30 & 31 high) and above that area, the euro could test November highs located at 1.1685/90 and the 1.1700 handle. A critical level above currently stands at 1.1740, the downtrend line from September highs, a break higher could signal that a short-term bottom is in place.