The pair looked like it was set for an upside breakout yesterday before the dollar turned things around and sellers latched on to the 100-day moving average (red line).
The key level is seen @ 1.2054 and price is pushing further away towards 1.2000 in European morning trade, as sellers now test the 100-hour moving average instead:
The near-term level is holding any further downside pressure for now, alongside the 1.2000 level as buyers are not throwing in the towel just yet.
But amid the dollar bounce yesterday, the technical momentum in the past week has been snuffed out. Essentially, we're caught in a battle between holding above 1.2000 and trying to keep below the 100-day moving average @ 1.2054.
Risk sentiment is faring slightly better on the session with US futures now in positive territory while Treasury yields are up slightly. 10-year yields are up 1.8 bps to 1.577%.
There is still some sense of trepidation so far and we may have to wait until Wall Street enters the fray to have a better sense of risk flows later today.