Risk-off moods can be spotted during the European trading session today with equities and EUR dropping hard. The main currency pair dropped below the 1.10 handle for the first time since late-May 2020 and trades 0.7% lower on the day. Sentiment was negatively impacted by overnight reports of Russian attack on Europe's largest nuclear power plant in Ukraine. Subsequent assurances from various nuclear agencies that radiation levels have not increased and reactors do not seem to be in danger did little to improve the moods. War in Ukraine is a main driver of moods in the markets and traders should be aware of potential rebalancing ahead of the weekend that could exert pressure on risk assets.
Taking a look at EURUSD chart, we can see that the main currency pair broke below 1.10, confirming a long-term bearish trend. In case bearish sentiment prevails, a test of the 1.0890 area, where the exterior 161.8% retracement of the latest upward impulse can be found, cannot be ruled out.
Source: xStation5
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