Financial markets started the week in risk-off mode. The EUR/USD pair broke below the 1.0100 level, the last major support area before the parity level, with the US dollar underpinned across the board amid global recession concerns.
At the time of writing, the EUR/USD pair currency trades at de 1.0075 area, 1.08% below its opening price, having hit a fresh cycle low of 1.0052.
Fresh lockdowns after a coronavirus outbreak in China fired up global supply chain disruptions fears, making the safe-haven flows dominate the markets on Monday.
The US dollar, measured by the DXY index, stands at 108.10 after reaching its highest level since October 2002 at 108.19, while the yield on the United States 10-Year note slipped below 3.0%, signaling higher demand for bonds. In the absence of first-tier data releases, risk impulses will likely set the pace of the market for the rest of the day.
The short-term technical perspective for the EUR/USD remains bearish as the price continues to make lower lows and indicators remain in negative territory.
The RSI has gained a bearish slope and already stands at oversold levels, while the MACD prints higher red bars indicating a growing selling interest.
The bears have gained momentum after taking out the 1.0100 support area, which could see the EUR/USD pair falling to the parity level for the first time in two decades.
On the other hand, above 1.0100, the following resistance levels are seen at 1.0200 and 1.0300. A break above the latter could pave the way to the 20-day SMA currently at 1.0415.