USD weakens as 10-year yields drop 7.3bps, EUR/USD breaks above 200-hour MA

The US dollar continued its downward trajectory Monday as Treasury yields declined sharply, with the 10-year yield falling 7.3 basis points to 4.357% and the 30-year dropping 8.1 basis points to 4.918% from last week's high of 5.07%. The yield decline has pressured the dollar across major pairs, with EUR/USD capitalizing on the weakness by breaking above its 200-hour moving average at 1.16567 and extending gains. The move represents a significant technical development as the pair establishes momentum above this key resistance level. The sharp reversal in yields suggests markets are reassessing Federal Reserve rate expectations, potentially pricing in a less hawkish stance. For traders, the break above the 200-hour MA opens the door for further EUR/USD appreciation toward 1.1700, while failure to maintain above this level could see consolidation around 1.1650.