EUR/USD retreats to 1.2360 on US data, 3-day lows

• Spot drops to lows near 1.2360.
• USD remains well bid on Monday.
• US PCE came in in line with consensus.

The single currency has gathered further downside momentum on Monday, motivating EUR/USD to record fresh daily lows in the 1.2365/60 band.

EUR/USD offered post-US releases

The pair kept the selling bias unaltered at the beginning of the week after US inflation figures measured by the core PCE showed consumer prices rose at an annualized 1.5% and 0.2% inter-month in December, matching initial estimates.

Further results from the US docket showed US consumer spending expanding below expectations 0.4% MoM during the same period, while consumer income rose at a monthly 0.4% (vs. 0.3% expected).

The greenback’s bid tone remains unabated so far today, forcing spot to give away part of the recent strong gains, while expectations of a rate hike by the Federal Reserve at the March meeting are closer to 80%, according to CME’s Group FedWatch tool.

EUR/USD levels to watch

At the moment, the pair is losing 0.46% at 1.2370 facing the next support at 1.2359 (low Jan.29) followed by 1.2310 (10-day sma) and finally 1.2172 (21-day sma). On the flip side, a breakout of 1.2537 (2018 high Jan.25) would target 1.2571 (high Dec.16 2014) en route to 1.2600 (psychological level).