EUR/USD reversed overnight gains on Tuesday, dropping to a six-session low of 1.0372 as risk aversion drove demand for the U.S. dollar and yen. The pair had rallied to 1.04583 ahead of New York’s open, but sellers emerged as U.S. Treasury yields declined, reinforcing the bid for safer assets. Equity and gold drops, alongside a rally in USD/CNH, further supported dollar strength. Weakness in EUR/JPY also pressured EUR/USD lower, with the pair down -0.35% by late trading despite a modest rebound from the session low.

Technical indicators suggest EUR/USD is struggling to find support. The pair’s hold below the 5- and 21-day moving averages, coupled with falling RSIs, underscores bearish momentum. Immediate support lies at 1.0372, with deeper levels at 1.0330 and 1.0300. Resistance is capped at 1.0458, with the 21-DMA at 1.0480 acting as a critical barrier for bulls. A sustained move below 1.0372 would likely confirm further downside, while a break above resistance could signal a potential reversal.

Risk sentiment will hinge on China’s December PMIs, which are set to impact global markets during the Asian session. Positive data may improve risk appetite and lift EUR/USD off its lows, while weaker-than-expected results could amplify the safe-haven rally, driving the pair toward key support levels. Until risk sentiment stabilizes, EUR/USD is likely to remain under pressure, with technicals favoring the bears in the short term.