EUR/USD traded down on Thursday, going into retreat after hitting a fresh 1-month high of 1.1185 on EBS, and the market's reaction to data and geopolitical risks suggest a further move lower is likely.

French inflation hit a record high nL2N2VY0DW and Italian CPI hit its highest since July 1991 nR1N2VO00A.

The data normally would have investors leaning towards a rise in interest rates from the ECB, but rates moved counterintuitively, with German yields DE10YT=RRDE2YT=RR falling sharply while Euribor prices FEIH4 turned positive after hitting new trend lows.

Despite the drop in German yields the recent tightening of German-U.S.
2-year spreads extended but was no help to EUR/USD longs.

Impacts and concerns to economic growth from the ongoing Russia-Ukraine crisis nL5N2VY5PBnL5N2VX7KZ are preventing the euro from gaining upside momentum.

EUR/USD's price action has generated bearish technical signals.
Daily RSI diverged on the new high and is now falling.
A daily bearish engulfing candle has formed and daily charts show a rising wedge is in the process of forming.
Monthly RSI continues its decline and is not oversold.

EUR/USD's inability to sustain upward momentum above the 50% Fibo of 1.1495-1.0806 reinforces the bearish tech signals.

A test of 1.0950/1.1000 support seems likely.
Should it break the 1.0800 area becomes a target again.

For more click on FXBUZ