The US dollar surged after May’s inflation beat expectations. The previous rebound’s failure to clear the supply area around 1.0760 indicates that the path of least resistance is down. A sharp drop below 1.0640 and 1.0540 forced the bulls to cut losses. The RSI’s oversold condition may cause a limited bounce. 1.0460 at the base of a bullish breakout is a key support. Its breach would invalidate the recovery and send the euro back into a downward trajectory. The bulls will need to lift 1.0640 before they could regain control.
