Dollar Hits Fresh Yearly High as EUR/USD Plunges into Oversold Territory

The US Dollar (USD) has reached a fresh yearly high, extending its winning streak to three weeks. This week's move was significant as it broke through several resistance levels, including the key Fibonacci level of 101.80 that had held highs in June. While USD/JPY was previously a major contributor to USD strength, last week saw the pair relatively calm, with the EUR/USD pair instead providing a significant portion of the push. The EUR/USD has been experiencing a mean reverting, range-bound tendency, but it has recently pushed into oversold territory on the daily chart, its most extreme reading since 2015. This has led to speculation about potential scenarios: either further USD strength indicating major macro stress or a correction that could lead to mean reversion setups. Meanwhile, USD/JPY was relatively calm this week, with buyers continuing to bid up pullbacks in the pair.