EUR/USD recedes to 2-day lows near 1.1730

• EUR/USD loses further momentum and re-tests 1.1730/25.
• The German Business Climate came in at 99.4 in August.
• US Durable Goods Orders contracted 0.1% MoM in July.

The selling pressure now intensifies around the European currency and drags EUR/USD to new lows in the 1.1730/25 band.

EUR/USD offered, dollar recovers

The now moderate recovery in the dollar puts the positive streak in EUR/USD to the test amidst a slow rebound in yields of the US 10-year reference to the are beyond the key 1.30% yardstick.

Earlier in Germany, the IFO survey came in mixed and showed the Business Climate receded to 99.4 (from 100.7) for the month of August.

On the ECB front, VP De Guindos said that the central bank could revise up its macroeconomic projections, adding that indicators in the third quarter are positive. More on the central bank, Board member P.Lane said that the QE programme will not end once the PEPP is finished and added that the high vaccination rate in the euro area mitigates the impact of the delta variant.

In the US docket, Mortgage Applications expanded 1.6% during the week ended on August 20. Further data saw headline Durable Goods Orders contracting at a monthly 0.1% in July, while orders excluding transportation expanded more than expected 0.7% inter-month.

EUR/USD levels to watch

So far, spot is losing 0.02% at 1.1751 and a breakdown of 1.1663 (2021 low Aug.20) would target 1.1612 (monthly low Oct.20 2020) en route to 1.1602 (monthly low Nov.4 2020). On the upside, the next resistance is located at 1.1804 (weekly high Aug.13) followed by 1.1817 (50-day SMA) and finally 1.1908 (monthly high Jul.30).