Forex Trading Tools and Services

Currencies EUR/USD

EUR/USD Price Outlook: Testing Key Support Levels Amid Bullish Momentum

  • BY
  • May 7, 2025
  • 0 Comments

EUR/USD currency pair is now testing key support levels near 1.1320, with short-term bullish momentum boosted by the nine-day Exponential Moving Average (EMA) and the 14-day Relative Strength Index (RSI) staying above the 50 level. Unless recent retracements reverse the trend, the pair is still biased higher in an ascending channel pattern and could return to the April 21 high of 1.1573, which was its strongest level since November 2021. However, a breakdown below key support areas could reorient the trend into bearish grounds with additional risks for further losses extending towards the 50-day EMA at 1.1057 and a possible six-week low at 1.0360. KEY LOOKOUTS •  EUR/USD is probing important support at the vicinity of the nine-day EMA at 1.1320. A penetration below this might change the bias to a more bearish bias, paving the way for more downside. •  The 14-day RSI is still above the 50 level, supporting the ongoing bullish bias. Monitor any noteworthy changes in RSI behavior as an indication of possible trend reversals. • The duo can test the April 21 high of 1.1573, its highest since November 2021. Breaking above this level successfully may trigger more bullish action, with the next resistance around 1.1730. •  If the 1.1320 support gives way, the EUR/USD may extend its fall, with significant downside targets at the 50-day EMA (1.1057) and the six-week low of 1.0360. Watch out for these levels to spot possible trend reversals. EUR/USD pair stands at a pivotal resistance, testing significant support around 1.1320, which is bolstered by the nine-day Exponential Moving Average (EMA). As long as the 14-day RSI stays above 50, indicating continued bullish pressure, a fall below this support would change the outlook to the downside, with possible targets at the 50-day EMA of 1.1057 and the six-week low of 1.0360. To the upside, the pair is targeting the April 21 high of 1.1573, a level not reached since November 2021, with additional resistance around 1.1730. Since the pair is oscillating within an upward channel, investors should monitor any changes in these major levels to determine the direction to expect next. EUR/USD is probing important support at 1.1320, and bullish momentum is shown by the RSI being above 50. If broken, this could see a decline to 1.1057, or the upside move to the April 21 high of 1.1573. Traders should be keenly aware of these levels for possible trend reversals. • EUR/USD is probing major support at the nine-day EMA at 1.1320, with a possible bearish reversal if this level is penetrated. • The 14-day RSI continues to stay above 50, reflecting positive momentum and supporting the short-term bullish bias. • The April 21 high at 1.1573 is a pivotal resistance level, possibly indicating further appreciation if penetrated. • EUR/USD is in an upward channel, indicating sustained bullishness unless there is a breakdown below support. • A breakdown below 1.1320 may find the pair challenging the 50-day EMA of 1.1057, a key level for medium-term trends. • A further drop may take the pair to the six-week low of 1.0360, which was last hit on February 28. • Traders need to watch closely key support and resistance levels to measure possible trend reversals or continuation. EUR/USD pair is now at a pivotal point as it consolidates around key levels, with a dominant bullish sentiment affecting its short-term direction. Such momentum is driven by optimistic market expectations, and even with recent retracements, the general trend appears to continue upward. With the duo moving through this stage, its ability to continue along the current path is being watched closely by traders and analysts, particularly as it hangs around key levels that may determine its next move. EUR/USD DAILY PRICE CHART CHART SOURCE: TradingView In the overall picture, the EUR/USD is set in a manner that indicates possible future prospects for additional increases, particularly with historical highs looming. Market sentiment is positive, bolstered by the pair’s overall upward trend and the expectation of positive market events. Investors will probably maintain a close watch over global economic reports and political events, which might affect the direction of the EUR/USD and strengthen or undermine its current trajectory. TECHNICAL ANALYSIS EUR/USD pair is testing key support near the nine-day Exponential Moving Average (EMA) at 1.1320, with the 14-day Relative Strength Index (RSI) still above 50, showing ongoing bullish momentum. The pair is in an ascending channel, reflecting the likelihood of continuing higher if supported above this level. The major resistance is at April 21 high of 1.1573, with additional upside to 1.1730. A breakdown below the present support levels may result in a change of sentiment, which may propel the pair towards the 50-day EMA at 1.1057, with additional downside risks stretching to the six-week low of 1.0360. FORECAST EUR/USD pair can potentially maintain its bullish trend, particularly if it remains above the critical support at 1.1320. If the pair is able to hold within its uptrending channel, it may revisit the April 21 high of 1.1573, the highest level since November 2021. A successful breakout above this would propel the uptrend further, with the next resistance target at 1.1730. Based on current market sentiment and technical indicators, there is hope for the pair to test the higher levels in the near future. Conversely, a decline below the key support area of about 1.1320 would represent a change in market sentiment, paving the way for further bearish action. Below this level, the pair might test the 50-day EMA at 1.1057, which is likely to provide strong support. A further drop would be towards the six-week low of 1.0360, last recorded in February. This would signal a faltering of the medium-term bullish trend, and the traders would keep a close eye on these lower levels for stabilization or additional pressure to the downside.

Read More
Currencies EUR/USD

EUR/USD Forecast: Bullish Trend Goes On with 1.1400 as the Next Important Target

  • BY
  • April 28, 2025
  • 0 Comments

EUR/USD currency pair continues to be bullish as it holds firm near 1.1360 in the Asian session amid a strong technical position. The pair is comfortably above the 100-day Exponential Moving Average (EMA), with the Relative Strength Index (RSI) indicating sustained bullish momentum. The immediate overhead is at 1.1400, with scope for further upside towards 1.1547 and 1.1647. On the negative side, there is support at 1.1315, and a continued break below this may unlock the way for a pullback to 1.1000 or even 1.0888. With mixed signals on US-China trade relations, nonetheless, the bullish outlook for EUR/USD continues to hold in the near term. KEY LOOKOUTS •  The immediate upside target for EUR/USD is at the psychological level of 1.1400. A break above this level could set the stage for further rallies to 1.1547 and 1.1647. • The initial strong support to watch is 1.1315, the April 24 low. A strong and persistent move below this could indicate a possible fall to lower degrees, e.g., 1.1000. • EUR/USD continues to be supported by a solid bullish sentiment, with the currency trading above the important 100-day EMA and an RSI of 61.80, which shows sustained bullish momentum. • Uncertainty from mixed signals provided by the US and China regarding trade talks might engender volatility for the pair, and hence close attention needs to be paid to fresh information that can influence market sentiment. EUR/USD remains on a bullish outlook, with the pair maintaining ground around 1.1360, underpinned by a strong technical platform. The nearby resistance is located at 1.1400, and breaching this barrier may trigger the price to proceed higher towards 1.1547 and then 1.1647. On the down side, a first support in view is located at 1.1315, and its breach may alert for a downtrend towards 1.1000. The pair’s bullish bias is supported by the 100-day EMA and a positive RSI, which reflects continuous upward momentum. Nevertheless, market volatility may rise due to continued uncertainty over US-China trade relations, and it is therefore important to be vigilant for any news update that could shape market sentiment. EUR/USD has a positive outlook with support at 1.1315 and resistance at 1.1400. The bull run of the pair is complemented by a high RSI and the support of the 100-day EMA, despite possible volatility driven by US-China trade uncertainties. • EUR/USD has a positive bias and is favored by a sound technical setup. • Short-term target of the upside move is 1.1400, with extended potential to rise towards 1.1547 and 1.1647. • The initial crucial support level to monitor is 1.1315, and a probable decline to 1.1000 in the event of breaking this level. • The pair trades above the 100-day Exponential Moving Average (EMA), indicating ongoing bullish momentum. • The Relative Strength Index (RSI) above the midline at about 61.80 indicates continuing bullish momentum. • Ambiguity regarding US-China trade relations has the potential to cause market instability, affecting the price action of EUR/USD. • In case the bullish momentum keeps going, subsequent major resistance points are 1.1547 (April 22 high) and 1.1647 (upper Bollinger Band). EUR/USD is depicting strong bullishness as the market continues to perceive the outlook to be positive. The pair has the support of positive market sentiment,partly triggered by a fairly stable economic atmosphere in the Eurozone. Even as the currency pair has been strong, there exists some uncertainty surrounding the global economic situation, which is mainly being caused by confusing signals emanating from the US-China trade war. The trade tensions can make for some episodes of volatility but generally, there is a good sentiment for the euro against the dollar. EUR/USD Daily Price Chart Source: TradingView The persistent euro strength also has something to do with an absence of a major disruption of the Eurozone economy, where economic figures provide a stable background for the currency. At the same time, the US dollar is also facing some difficulty as the unpredictable nature of trade relations between China and the US clouds future prospects. As investors continue to observe these developments, the EUR/USD pair is set to stay in its existing bullish trend, although outside circumstances may cause short-term fluctuations. The general trend for EUR/USD is upward, and the market appears to be inclined towards the euro in the short term. TECHNICAL ANALYSIS EUR/USD is displaying a robust bullish inclination, bolstered by being above the significant 100-day Exponential Moving Average (EMA), confirming the upward motion to continue. The Relative Strength Index (RSI) is in positive ground and at 61.80, indicating buying pressure remains in place and the pair would be able to sustain its upward trend in the near term. The near-term resistance is at 1.1400, and if this level is breached, additional gains to 1.1547 and 1.1647 would be anticipated. On the downside, the initial support is at 1.1315, and a fall below this might indicate a reversal. Generally, the technical indicators are to the advantage of the euro, with robust support and bullish momentum driving the pair’s direction. FORECAST EUR/USD remains firmly in bullish sentiments, with the initial key resistance level at 1.1400. The breaking of this level may make way for increased gains, the next targets to the upside at 1.1547, April 22 high, and 1.1647, the top limit of the Bollinger Band. If there is sustained bearish momentum, these levels can serve as decisive markers, informing the market that the pair is likely to sustain its rising pattern in the ensuing sessions. To the downside, initial support for EUR/USD stands at 1.1315, which is the April 24 low. A prolonged slide below here would indicate a possible pullback towards the next support at 1.1000. Should selling pressure continue, the pair would be subject to further losses, with 1.0888, the April 8 low, standing out as a major target. Still, the pair is supported above these levels at present, containing the bearish scenario.

Read More
Currencies EUR/USD

EUR/USD Under Pressure Amid US Dollar Rebound and Poor Eurozone Economic Figures

  • BY
  • April 23, 2025
  • 0 Comments

EUR/USD recently saw a pullback, temporarily falling below 1.1400 as the US Dollar rallied, driven by President Trump’s remarks on the independence of the Federal Reserve and his hopes for hitting a trade agreement with China. This followed a period of volatility on concerns over tariffs and the Fed’s interest rate plans. At the same time, the Euro came under pressure from soft Eurozone economic indicators, with the April PMI showing weak growth, especially in the services sector. With market players expecting possible ECB rate reductions, the short-term direction of the EUR/USD pair is unclear, as the US Dollar is already displaying signs of regaining its safe-haven appeal. KEY LOOKOUTS • The US Dollar has picked up steam after President Trump’s assurances regarding the independence of the Fed and his positive sentiments on US-China trade negotiations. Market players will be looking for updates in these fronts to assess the sustainability of the Dollar’s recovery. • Poor PMI readings in the Eurozone, specifically a decline in the services sector, indicate the struggles of the region’s economic growth. Investors will watch closely for future economic statistics to determine if this trend persists. • Increasing speculation that the European Central Bank (ECB) might make further interest rate cuts in June could negatively impact the Euro. Words from ECB officials, especially President Christine Lagarde, will be crucial to determining the central bank’s future action. • The EUR/USD pair is resisted at the important 1.1600 level, and 1.1276 is a pivotal support area. Traders need to monitor these levels for possible price action that might determine the next direction for the pair. EUR/USD has come under downward pressure lately, falling below 1.1400 as the US Dollar gained strength after President Trump’s words of comfort to the market regarding the Federal Reserve’s independence and his optimistic view on US-China trade negotiations. The Euro has fared poorly, burdened by soft Eurozone PMI readings, especially a decline in the services sector, which indicated slowing economic growth in the region. Also, rising hopes that the European Central Bank (ECB) will reduce interest rates further in June have contributed to the weakness of the Euro. While the market weighs these factors, EUR/USD is in a precarious balance, with important resistance at 1.1600 and support at 1.1276. EUR/USD recently broke below 1.1400, as the US Dollar appreciated following President Trump’s remarks about the Fed and US-China trade negotiations. However, soft Eurozone PMI data and anticipations of future ECB rate reductions are weakening the Euro, making the currency pair remain in cautious territory. • EUR/USD fell as the US Dollar rallied, driven by President Trump’s assurance regarding the Federal Reserve’s autonomy and positive trade discussion news with China. • The April PMI data from the Eurozone showed poor economic growth, with a decline in the service sector, putting pressure on the Euro. •  Trump showed optimism that the US and China would come to a trade agreement, mitigating some of the tariff-related uncertainty that had previously weighed on the market. • Trump also signaled frustration with the Fed’s decision not to lower interest rates, injecting volatility into the market’s view of US monetary policy. • Heightened expectations that the European Central Bank will cut interest rates again in June are putting pressure on the Euro. • EUR/USD is resisted at the 1.1600 level, with support at the July 2023 high of 1.1276. • Investors are hesitant as they wait for additional economic data from both the US and Eurozone to determine the trend of the EUR/USD pair. EUR/USD pair has recently seen a change in momentum, mainly as a result of events in the US economy and trade negotiations. President Trump’s words of support for the Federal Reserve’s independence and optimism regarding a possible trade agreement with China have given the US Dollar a boost. His assurances have eased market fears over the Fed’s policies, specifically concerns that he would attempt to oust Chairman Jerome Powell. This has given the US Dollar an added attractiveness as investors regained confidence in its stability. EUR/USD DAILY PRICE CHART CHART SOURCE: TradingView Conversely, the Eurozone is suffering from economic issues, with low PMI numbers indicating that the region’s growth is decelerating, especially in the services sector. The possibility of additional rate cuts by the European Central Bank has also contributed to doubts regarding the strength of the Euro. With low inflation expectations and economic activity in the doldrums, the Euro is facing pressure as investors expect further policy measures by the ECB. These factors have placed the EUR/USD pair in a precarious balance, with the US Dollar picking up steam and the Euro struggling to keep its footing amidst regional economic strife. TECHNICAL ANALYSIS EUR/USD has run into resistance at the 1.1600 level, which has halted its recent upward movement. The pair dipped briefly below 1.1400, signaling a correction after touching a three-year high of 1.1575. The 14-week Relative Strength Index (RSI) has spiked above the 70.00 mark, indicating strong bullish pressure but also hinting at potential correction in the near future. Support for the pair is at the July 2023 high of 1.1276, and a strong dip below this point may indicate further downward potential. While the pair remains in this vicinity, the key levels will be eyed by traders for probable breakout or reversal trades. FORECAST If the US Dollar continues to exhibit strength, especially in view of additional favorable news in trade talks or optimism regarding the policies of the Fed, EUR/USD may remain under pressure. But if the Eurozone can stabilize its economic situation and the ECB does not make additional drastic rate cuts, there is some hope for the pair to turn around. A breach above the 1.1600 resistance would be an indication of a change in direction, with further increases to higher levels possible. A boost in stronger economic numbers or fiscal stimulus plans in the Eurozone could also support the Euro to some extent, aiding its recovery. EUR/USD stands at risk of further declines in case the

Read More
Currencies EUR/USD

EUR/USD Falls as ECB Reduces Rates in Face of Global Trade News and Market Volatility

  • BY
  • April 17, 2025
  • 0 Comments

The EUR/USD currency pair experienced fresh selling pressure, declining back to 1.1340 following the European Central Bank (ECB) decision to make a widely expected 25 basis point cut in rates — its sixth successive reduction — as part of its ongoing campaign to nudge inflation back towards the 2% goal in the face of a weakening Eurozone economy. The ECB’s move, along with its deletion of previous language indicating interest rates are still restrictive, hints at a possible end to the easing cycle. In the meantime, optimism about U.S.-Japan trade talks gave the U.S. Dollar a boost, while doubts over U.S.-China trade ties and Federal Reserve Chairman Jerome Powell’s dovish economic outlook kept global markets on edge. In spite of the near-term retreat, EUR/USD still has a bullish technical setup, with the next significant resistance seen at 1.1500. KEY LOOKOUTS • The European Central Bank cut its key lending rates by 25 basis points but importantly avoided saying that rates will continue to be “restrictive” — suggesting that it might be ready to end its easing cycle as inflation trends improve. • Encouraging developments in trade talks between Japan and the U.S., which were highlighted by President Trump, relieved the U.S. Dollar and dampened EUR/USD recovery efforts. • Investors are looking forward to ECB President Christine Lagarde’s comments for greater insights into the central bank’s future policy direction, particularly how the continued global trade tensions affect it. •  As EUR/USD dipped below 1.1340, technical metrics such as the 14-day RSI holding above 70 and more sloping EMAs indicate the pair’s wider bullish trend is intact. The EUR/USD pair fell under renewed selling pressure, moving towards 1.1340 after the European Central Bank (ECB) declared a widely anticipated 25 basis point rate cut, its sixth in a row since the beginning of its easing cycle. The ECB’s decision reflects its ongoing efforts to tame inflation and support a slowing Eurozone economy, though the omission of any reference to rates remaining “restrictive” suggests policymakers may be eyeing a temporary pause. Meanwhile, the U.S. Dollar regained strength on the back of positive progress in U.S.-Japan trade negotiations, offering some relief to global markets amid persistent uncertainty over U.S.-China trade relations. Even with the ongoing correction, the EUR/USD pair still has a generally bullish outlook, with investors waiting anxiously for further guidance from ECB President Christine Lagarde’s next comments. EUR/USD continued to decline towards 1.1340 after the ECB trimmed interest rates by 25 basis points, as anticipated, indicating a possible end to its easing cycle. The U.S. Dollar strengthened amid positive U.S.-Japan trade news, further putting pressure on the pair. Investors now look to ECB President Lagarde’s remarks for new policy guidance. •  The European Central Bank cut its main borrowing costs as expected, its sixth consecutive reduction in response to softening Eurozone growth and cooling inflation. •  The EUR/USD currency pair fell towards 1.1340 following the rate decision, with strong selling pressure during early North American trading hours. •  For the first time in months, the ECB left out the word indicating interest rates are “restrictive,” which may indicate a possible halt to its rate-cutting cycle. •  Encouraging news from U.S.-Japan trade negotiations, led by President Trump’s announcement of “big progress,” brought relief to the U.S. Dollar. •   Markets are looking to ECB President Christine Lagarde’s comments for insight into future policy direction, particularly in the context of global trade uncertainty. •  In spite of the recent decline, the EUR/USD currency pair maintains a bullish setup with the support of higher sloping EMAs and the RSI remaining above the 70 level. •  Continued uncertainty regarding U.S.-China trade tensions continues to overshadow market sentiment, keeping traders defensive in the short term. The European Central Bank (ECB) announced yet another 25 basis point cut in interest rates, its sixth consecutive rate reduction since initiating its monetary easing cycle in June. The move is an extension of the ECB’s continued bid to stabilize the Eurozone economy as inflation makes slow progress towards its 2% target. Notably, the central bank did not reproduce its standard line that interest rates would continue to be “restrictive,” implying policymakers may be weighing a pause in additional reductions. The ECB reiterated that future policy will be “data-dependent” and influenced by the current global economic situation, specifically the uncertainty of international trade patterns. EUR/USD DAILY PRICE CHART CHART SOURCE: TradingView Meanwhile, international market focus has turned to developments in negotiations of trade talks between the United States and Japan. Favorable comments from both parties indicate better ties, providing a breath of relief for international markets that have been under pressure from tariff tensions. As the U.S.-Japan talks are progressing, however, general anxiety over the U.S.-China trade war remains, causing businesses and investors to remain guarded. As policymakers around the world adjust to these rapidly changing circumstances, market players are monitoring closely for any indication of how governments and central banks will act to protect economic stability. TECHNICAL ANALYSIS EUR/USD currency pair is undergoing a good correction after unable to maintain its momentum above the 1.1400 mark. Even after the correction, the overall trend is bullish since the price continues to trade above the major short-to-long-term Exponential Moving Averages (EMAs), indicating underlying strength. Furthermore, the 14-day Relative Strength Index (RSI) continues to remain above the 70 level, indicating that bullish momentum remains in place, though marginally overheated in the near term. Traders are currently monitoring the psychological resistance level of 1.1500, which is still a critical upside target, while the April 11 low around 1.1190 acts as a robust support level, likely to be bought if the correction worsens. FORECAST EUR/USD continues to be bullish provided the pair remains above critical technical support levels. The steepening slope of the Exponential Moving Averages (EMAs) and the Relative Strength Index (RSI) remaining above the 70 level indicate solid underlying buying demand. If the pair picks up momentum, the first target would be the psychological resistance at 1.1400, and a clear break above this level could

Read More
Currencies EUR/USD

EUR/USD Stays Put Around 1.1350 as Market Prepares for ECB Interest Rate Decision and Fed Inflation War

  • BY
  • April 15, 2025
  • 0 Comments

The EUR/USD currency pair stays put around the 1.1350 level as the US Dollar tries to regain stability as stagflation fears increase and as market sentiment turns defensive. Market participants are watching remarks from Federal Reserve officials, such as Atlanta Fed President Raphael Bostic, who noted the long way that will have to go to achieve the central bank’s 2% inflation target — a sign that rate decreases will not come as early as some had anticipated. In the meantime, everyone is focused on the next policy meeting of the European Central Bank, when a widely anticipated 25 basis point reduction in interest rates might determine the Euro’s short-term direction. Uncertainty over global trade tensions and changing projections by major financial institutions such as Deutsche Bank also contribute to the confusion, leaving market participants vigilant for any hints about the future course of monetary policy on both the Atlantic and other sides. KEY LOOKOUTS • Markets are expecting a 25 basis point rate cut in Thursday’s European Central Bank meeting, and they are looking for forward guidance on the future of monetary easing. • Federal Reserve officials, particularly Raphael Bostic, indicate that rate cuts might take a bit longer as the US central bank stays loyal to its 2% inflation target. • Market participants look for the ECB’s Bank Lending Survey for information on credit conditions, which may have implications for both the rate decision and the ECB’s economic outlook. • Increased trade uncertainty and possible US tariff changes remain weighing on market sentiment, providing near-term support for the Euro with recession fears in the US. With the EUR/USD pair trading around the 1.1350 mark, market attention turns to a number of key drivers that may decide its next direction. The European Central Bank is to make its highly anticipated policy rate decision on Thursday, with traders broadly factoring in a 25 basis point interest rate cut, while also looking for any guidance on future easing cycles. Across the Atlantic, the Federal Reserve’s measured approach to inflation — in the wake of Atlanta Fed President Raphael Bostic’s comments — indicates that the journey towards U.S. rate cuts could be slower than anticipated. The publication of the ECB’s Bank Lending Survey will also provide new clues on the state of credit in the Eurozone. At the same time, persistent global trade tensions and doubts over possible U.S. tariff shifts remain to influence investor mood, offering risk and support to the Euro in the short term. The EUR/USD pair remains anchored around 1.1350 as markets look for the ECB’s anticipated 25 basis point rate cut and more hints on monetary policy. The US Dollar, meanwhile, looks to stabilize as Fed officials remain cautious about inflation and ongoing global trade tensions. Investors look for major data and central bank comments to determine the next move. •  EUR/USD hovers around 1.1350 as the pair remains range-bound with risky market sentiment. •  The US Dollar tries to firm up as stagflation fears reemerge and dampen global risk appetite. •  Federal Reserve’s Bostic indicates a long way to go before reaching the 2% inflation goal, dashing hopes for imminent rate cuts. •  ECB to cut the rate by 25 basis points at its policy meet on Thursday, keeping the Euro in limelight. •  Deutsche Bank revises rate cut prediction for Fed, anticipating first cut in Dec 2025, two additional cuts in early 2026. •  The ECB’s Bank Lending Survey (BLS) is under the spotlight for information regarding credit conditions and the health of the Eurozone economy. • Global trade tensions and recessionary concerns continue to underpin the Euro and place pressure on the US Dollar’s rebound. The EUR/USD currency pair remains firm as market participants look towards this week’s key central bank news and economic releases. The European Central Bank is widely anticipated to cut interest rates by 25 basis points at its next policy meeting, a move designed to underpin growth throughout the Eurozone. Meanwhile, market players are monitoring the ECB’s Bank Lending Survey, which will offer useful insight into how credit conditions are influencing the region’s overall financial well-being. EUR/USD DAILY PRICE CHART CHART SOURCE: TradingView Meanwhile, the US Dollar is holding its ground as traders digest recent comments from Federal Reserve officials. Atlanta Fed President Raphael Bostic’s statement underlined that the path to bringing inflation back to the 2% target remains challenging, hinting that US rate cuts may not arrive as soon as previously expected. In addition to central bank indications, persistent global trade tensions and policy uncertainty are also exercising considerable influence over investor sentiment, with markets pricing in possible risks to the global economy in the coming months. TECHNICAL ANALYSIS EUR/USD is trading around the 1.1350 level, hinting at consolidation as the pair awaits strong directional signals. The latest price action suggests indecision surrounding major levels of resistance and support, pointing to the fact that traders wait for new sparks from central bank policies or fresh economic data to push through resolute moves. A continued penetration of near-term resistance may be enough to establish further room on the upside, but a inability to maintain present support levels would risk exposing the pair to greater bear pressure short-term. FORECAST If the European Central Bank’s forthcoming policy announcement and economic commentary succeed in finding an even keel — loosening but remaining upbeat on the recovery of the Eurozone — then the EUR/USD pair might strengthen in the near term. Surprise improvements in Eurozone economic statistics or hints at weakening US inflation might similarly prop up the Euro, sending the pair higher to resistance levels as risk appetite is regained by investors. On the flip side, if the rate cut by the ECB is coupled with a more dovish tone or the US Dollar gains new strength on the back of improved economic indicators or diminishing recession fears, EUR/USD could see fresh selling pressures. Also, ongoing global trade tensions and any rise in geopolitical tensions would tempt investors to take refuge in the

Read More
Currencies EUR/USD

EUR/USD Breaks Above 1.1100 as Softer US CPI and Tariff Halt Fuel Euro Strength

  • BY
  • April 10, 2025
  • 0 Comments

The EUR/USD currency pair broke above 1.1100 after a softer-than-projected U.S. Consumer Price Index (CPI) reading for March and a temporary tariff retreat by President Donald Trump. The euro’s rally intensified in the face of market euphoria over a 90-day suspension of tit-for-tat tariffs, which initially boosted the U.S. dollar but soon gave way to fresh euro strength. Weaker inflation data, with both headline and core readings falling short of expectations, spurred hopes of imminent Fed rate cuts, even though the CME FedWatch tool indicated lower probabilities for a May cut. With volatility continuing to trend higher, EUR/USD continues to move higher, setting its sights on the 1.1200 resistance. KEY LOOKOUTS • EUR/USD is close to the significant resistance zone at 1.1200 that topped rallies in August and September 2024. Breaking above this level would indicate a more bullish continuation. •  On the negative side, the uptrend line around 1.0910 and the 200-day SMA at 1.0735 are crucial supports to look out for on a pullback. •  Market sentiment will likely change following remarks from top Fed officials today, including Lorie Logan, Michelle Bowman, Austan Goolsbee, and Patrick Harker. •  With the odds of a May rate cut declining to 19.5%, there remains a 75.3% chance of a cut in June that keeps rate policy on everyone’s mind and driving EUR/USD direction. The trader must watch closely the 1.1200 resistance level that capped previous EUR/USD rallies and now represents a critical breakout point. To the negative, the uptrend line at 1.0910 and the 200-day SMA level of 1.0735 serve as significant support levels that may cushion a pullback. Market players will also be listening to a string of speeches from various Federal Reserve officials, which may provide new clues to forthcoming monetary policy action. Furthermore, although the chances of a May rate cut have receded, a 75.3% chance of easing in June still dominates investor sentiment and may generate more volatility in the pair. Important resistance for EUR/USD is at 1.1200, while powerful support is at 1.0910 and the 200-day SMA at 1.0735. Speeches by Fed officials and changing rate cut expectations—now in favor of June—are still vital determinants of the pair’s next step. • EUR/USD breaks above 1.1100 following softer-than-anticipated U.S. CPI data. • March CPI reported monthly headline inflation fell by 0.1%, lower than expectations. • Core inflation also slowed down, supporting hopes of a Fed rate cut within the next few months. • 90-day tariff hiatus by President Trump initially supported the dollar but reversed swiftly. • Resistance is at 1.1200, with interim resistance at 1.1146. • The major supports are 1.0910 (trend line) and 1.0735 (200-day SMA). • Fed speakers and June rate cut probabilities (75.3%) will continue to be the key drivers in terms of near-term direction. The EUR/USD currency pair shot above the 1.1100 level following the softer-than-expected U.S. Consumer Price Index (CPI) for March, which fuelled hopes of a more dovish Federal Reserve policy. Both headline and underlying inflation numbers fell short of expectations, with monthly headline inflation even registering a decline of 0.1%. This surprise softness in inflation numbers propelled the euro against the dollar, as investors reevaluated the timing for possible interest rate reductions. Following on the heels of momentum was President Donald Trump’s revelation of a 90-day hiatus on mutual tariffs, which initially buoyed the U.S. dollar before sentiment turned in the euro’s favor. EUR/USD DAILY PRICE CHART CHART SOURCE: TradingView EUR/USD pair is displaying significant bullish momentum as it retakes key psychological levels. Resistance currently stands at 1.1146 and the key hurdle at 1.1200, which sat on top of earlier rallies during 2024. Support in the downside stands at the upward trend line close to 1.0910 and the 200-day Simple Moving Average (SMA) level of 1.0735. Market participants will be listening carefully today to several comments from Federal Reserve officials, along with forthcoming economic statistics, as they look for guidance on whether there will be a rate reduction in June—a prospect currently at 75.3% pricing. All this will probably leave EUR/USD jumpy short term. TECHNICAL ANALYSIS EUR/USD is showing intense buying pressure, recovering the vital 1.1000 point and heading toward the resistance zone at 1.1146, the latest year-to-date high. A persistent breach above this level may create the possibility for a challenge of the pivotal 1.1200 resistance band, which already topped gains in late 2024. Support on the downside comes initially at the rising trend line at around 1.0910, then the 200-day Simple Moving Average (SMA) at 1.0735. If bearish pressure becomes more pronounced, further support comes in at the 1.0667 pivot and the 55-day SMA of 1.0645, which makes these levels important to sustain the existing bullish structure. FORECAST If the bullish momentum is sustained, EUR/USD is set to continue its rally in the near term. A definitive breakout above the 1.1146 resistance would set the stage for the psychologically important 1.1200 level, which served as a robust ceiling during August and September 2024. A strong close above 1.1200 is likely to stimulate additional buying pressure, potentially all the way up to 1.1270 and even 1.1350 in the medium term. Confirmation from softer U.S. inflation data and increasing market conviction in a June Federal Reserve rate cut may continue to boost the euro’s strength versus the dollar. Conversely, if the rally falters or hawkish comments by Federal Reserve officials erode rate cut hopes, EUR/USD may see renewed selling pressure. A fall below the short-term support at 1.0910, indicated by the rising trend line, would represent diminishing bullish pressure. This may induce a deeper decline towards the 200-day SMA at 1.0735. In case bearish momentum strengthens, further intraday targets are the 1.0667 pivot and the 55-day SMA at 1.0645, where the buyers may try to reverse the pair.

Read More
Currencies EUR/USD

EUR/USD Falls Below 1.0950 as Fed Decision Approaches Amid Strength in Dollar and Eurozone Trends

  • BY
  • March 19, 2025
  • 0 Comments

The EUR/USD crossed below the level of 1.0950 during Wednesday morning’s Asian trading, staying at around 1.0935 as market participants take a guarded approach ahead of the U.S. Federal Reserve interest rate determination. The U.S. Dollar received mild lift from more solid industrial production, contributing to traders’ expectation amid the Fed’s revised rate guidance and economic report. Although the central bank is expected to leave interest rates on hold, the press conference and dot-plot that accompany it could provide key policy guidance. Separately, a large spending budget passed by Germany’s parliament could support the Euro, indicating increased investment activity in the Eurozone’s largest economy. KEY LOOKOUTS • Markets watch for the Fed’s rate move and economic forecasts, which will determine the tone of USD movement going forward. • Robust US industrial production figures support the Dollar; additional strength could put pressure on EUR/USD below significant support levels. • Bundestag approval of a significant spending increase could underpin the Euro and restore investor confidence in the Eurozone economy. • Traders are cautious ahead of Fed commentary; increased volatility anticipated after the decision, affecting short-term EUR/USD direction. As the EUR/USD currency pair declines below 1.0950 in anticipation of the highly expected Federal Reserve interest rate decision, market players are keenly observing major events that may influence the near-term direction. The US Dollar has strengthened after positive industrial production figures, increasing hopes for a more aggressive Fed policy. Investors will closely monitor the Fed’s revised economic forecasts and the dot-plot, which may provide key information on the rate path ahead. In the meantime, Germany’s approval of a huge spending budget brings a possible Euro boost, signaling fresh fiscal support for the Eurozone’s biggest economy. Overall, sentiment is still wary, with volatility set to spike after the Fed announcement. EUR/USD falls below 1.0950 as traders wait for the Federal Reserve to make its interest rate decision and revise its economic forecasts. The stronger US Dollar and Germany’s recently approved budget plan are significant drivers of the pair’s movement. Volatility is likely to increase after the Fed announcement. • EUR/USD falls to about 1.0935 during Wednesday’s Asian session, falling below the 1.0950 mark. • Investors stay on guard in anticipation of the Federal Reserve interest rate announcement and economic forecasts later today. • The Fed will likely keep interest rates unchanged, but the dot-plot and press conference can give hints of future policy directions. • US Dollar appreciates slight strength as underpinned by better-than-expected US industrial production data for February (+0.7% MoM). • Germany’s parliament sanctioned a big spending spree, a sign of possible economic recovery in the Eurozone’s biggest economy. • Market sentiment remains divided, with investors in wait-and-watch mode following the Fed announcement. • Greater volatility anticipated in EUR/USD in the wake of the Fed verdict and reports on inflation projections. The foreign exchange market is in wait-and-watch mode with international investors awaiting the coming interest rate verdict of the U.S. Federal Reserve. Though the central bank is mostly expected to leave interest rates as they are, everyone is looking forward to the press conference and new economic projections for clues on the course of future monetary policy. The latest release of robust industrial production numbers in the U.S. has contributed to the expectation, signaling strength in the economy and adding to further interest in the central bank’s inflation and growth outlook. EUR/USD Daily Price Chart Chart Source: TradingView In the meantime, European developments have ushered in a tide of optimism, as Germany’s parliament passed a big-ticket spending plan designed to spur investment. The action is likely to underpin economic recovery efforts in the Eurozone’s biggest economy and potentially bolster market confidence in the region’s growth prospects. With traders waiting on the sidelines for key policy signals, the overall market tone is set by the interplay between U.S. economic vigor and Europe’s revived fiscal efforts. TECHNICAL ANALYSIS EUR/USD is picking up signs of mild weakness following its fall below the 1.0950 level, reflecting cautious market sentiment pre-Fed decision. The pair is now trading close to 1.0935, with near-term support at the 1.0900 psychological level. A break through this region may pave the way for further bear pressure. On the higher side, resistance is expected to be encountered in the 1.0975–1.1000 area, where sellers are likely to re-enter. Overall, the price action indicates a consolidation period, with investors waiting for a clear direction of breakout after major economic indicators from the U.S. Federal Reserve. FORECAST If the U.S. Federal Reserve keeps its policy statement and economic forecasts neutral or dovish, it may cap further gains in the U.S. Dollar. In this context, the Euro could find footing, particularly with Germany’s freshly approved budget plan set to fuel economic sentiment in the Eurozone. Better fiscal prospects in Europe could provide a supportive environment for the EUR/USD pair to move higher if global risk appetite also improves. Conversely, if the Fed hints at a more aggressive policy—i.e., the likelihood of rate hikes or a less aggressive sequence of easing—then the U.S. Dollar will likely pick up even more steam. This will potentially put downward pressure on the Euro, sending EUR/USD lower over the short run. Also, if future Eurozone data does not indicate a robust recovery in spite of Germany’s budget stimulus, market faith in the Euro will further deteriorate, exacerbating the downside risk.

Read More
Currencies EUR/USD

EUR/USD Stays Firm in Face of German Debt Reforms and ECB Rate Decision: Market Analysis and Key Drivers

  • BY
  • March 6, 2025
  • 0 Comments

EUR/USD stays firm at the 1.0800 level as investors await the highly expected interest rate decision of the European Central Bank (ECB), with a 25 bps rate cut to 2.5% on the cards. Market mood is influenced by Germany’s mooted 500 billion Euro infrastructure fund, which may affect inflation and economic growth. In the meantime, US President Trump’s temporary easing of car tariffs on Mexico and Canada has alleviated fears of a trade war, with the result that the US Dollar has weakened. Soft US private jobs data have also raised the prospect of a Federal Reserve interest rate cut in June. Now, investors wait for ECB President Christine Lagarde’s remarks and future US Nonfarm Payrolls (NFP) releases to guide the markets further. KEY LOOKOUTS • The European Central Bank is likely to reduce the Deposit Facility Rate by 25 bps to 2.5%, impacting EUR/USD price action and investor sentiment. • Germany’s planned 500 billion Euro infrastructure fund and extended borrowing capacity may affect inflation expectations and the economic outlook of the Eurozone. • Trump’s temporary easing of auto tariffs on Canada and Mexico has reduced trade tensions, but possible tariffs on German cars continue to be a major risk. • Soft US private hiring data have fueled speculation of a rate cut by the Fed, which makes the release of Friday’s NFP a highly market-moving event. EUR/USD continues to be a hot topic for traders as significant economic and policy events are played out. The ECB’s anticipated 25 bps rate cut to 2.5% has the potential to influence future monetary policy, while Germany’s planned 500 billion Euro infrastructure fund could fuel inflation and economic growth in the Eurozone. In addition, President Trump of the US has temporarily softened auto tariffs on Canada and Mexico, which has softened trade tensions but leaves uncertainty over possible tariffs on German automobiles. Furthermore, disappointing US private employment data have also spurred hopes for an interest rate cut by the Federal Reserve in June, and thus, coming Nonfarm Payrolls (NFP) release will be a pivotal driver in establishing the direction of the US Dollar. EUR/USD remains steady around 1.0800 as the market looks to the ECB’s anticipated 25 bps rate reduction and Christine Lagarde’s comments. Germany’s infrastructure fund and US trade policy contribute to the uncertainty, while soft US jobs data drives speculation of a June Fed rate cut. • The European Central Bank is anticipated to reduce the Deposit Facility Rate by 25 bps to 2.5%, influencing EUR/USD action. • A planned 500 billion Euro infrastructure fund and eased borrowing ceilings could fuel inflation and economic growth in the Eurozone. • Trump’s temporary easing of auto tariffs on Canada and Mexico softens trade tensions, but there is still uncertainty regarding possible tariffs on German cars. • The US Dollar Index (DXY) has fallen for the fourth day in a row, trading around 104.00, its lowest since four months ago. • Soft private sector employment growth has increased hopes of a June Federal Reserve rate reduction, impacting USD strength. • The pair is still robust above the 200-day EMA, with the RSI > 60, which means bullish momentum. • Market participants are monitoring the Nonfarm Payrolls (NFP) report closely for more cues on the direction of Fed monetary policy. The EUR/USD pair remains steady as investors focus on the European Central Bank’s (ECB) upcoming interest rate decision. The ECB is widely expected to cut its Deposit Facility Rate by 25 basis points to 2.5%, marking the fifth consecutive reduction. This decision comes amid Germany’s proposed 500 billion Euro infrastructure fund, which aims to boost economic growth and could influence inflation in the Eurozone. Traders are eagerly waiting for ECB President Christine Lagarde’s post-decision remarks for signals about future policy guidance and the overall economic landscape. Meanwhile, market sentiments are still under pressure due to fears of possible US tariffs on European products, especially German cars. EUR/USD Daily Price Chart Chart Source: TradingView On the international side, US trade actions and economic indicators continue to be major drivers of the forex market. US President Donald Trump’s temporary easing of automobile tariffs on Mexico and Canada has alleviated trade tensions, but uncertainty persists with possible tariffs on European goods. Separately, soft US private jobs data has fueled expectations of a Federal Reserve rate cut in June. Investors now await the Nonfarm Payrolls (NFP) report for additional insight into the health of the US labor market. Any meaningful changes in economic statistics or monetary policy decisions made by the Fed or ECB can influence currency trends in the near term. TECHNICAL ANALYSIS EUR/USD is well placed around the 1.0800 mark, demonstrating bullish sentiment on the charts. The pair has convincingly broken above the December 6 high of 1.0630, further strengthening an uptrend. It is still trading in excess of the 200-day Exponential Moving Average (EMA) at 1.0640, marking long-term robustness. 14-day Relative Strength Index (RSI) has surged above 60, a sign of extended buying pressure. On the down side, January 27’s high of 1.0533 is the critical support area, and the subsequent resistance point for Euro bulls is the November 6 high of 1.0937. In general, the technical perspective remains bullish for additional gains unless substantial bearish drivers arise. FORECAST EUR/USD might enjoy additional strength if the European Central Bank (ECB) takes a prudent stance even with the anticipated rate reduction. If ECB President Christine Lagarde provides cues of a diminished rate-cut pace in the future or hints at optimism regarding Eurozone economic rebound, the Euro can pick up momentum. Also, Germany’s planned infrastructure fund would help boost investor sentiment about the region’s growth prospects. A softer US Dollar, based on expectations of Federal Reserve rate cuts, might also sustain EUR/USD’s rally. In case the pair convincingly crosses above the 1.0937 resistance mark, it would test higher levels in the future sessions. EUR/USD risks facing downward pressures if the ECB turns more dovish, reflecting further aggressive rate cuts. Any weakness in the Eurozone economics, notably in

Read More
Currencies EUR/USD

EUR/USD Outlook: Gains Persevere Above 1.0400 On Weaker USD, Higher Upside Plausible

  • BY
  • March 3, 2025
  • 0 Comments

The EUR/USD currency pair makes a recovery above the 1.0400 level at the beginning of the week, boosted by a weaker US Dollar. Having rebounded off the 50% Fibonacci retracement level at around 1.0370, the currency pair exhibits signs of stabilizing, with the possibility of advancing towards the 1.0450 resistance and potentially the 1.0500 psychological mark. Yet, technical indicators are still mixed, calling for caution among bullish traders. On the downside, a break below 1.0370 may initiate further losses towards 1.0330 and 1.0300. Market sentiment continues to be driven by fears of US policies, and key resistance and support levels are important for short-term trading strategies. KEY LOOKOUTS • EUR/USD requires sustained strength above the 1.0450 resistance, which coincides with the 23.6% Fibonacci level, to validate further bullish momentum. • 50% Fibonacci retracement at 1.0370 is critical support; breaking below this might fuel selling pressure towards 1.0330 and 1.0300. • A weaker US Dollar provides EUR/USD with support, but any change in sentiment or better US data might cap the upside. • Ambiguity over US policies, such as tariffs, is still a risk driver that might fuel volatility and affect EUR/USD’s short-term direction. The EUR/USD currency pair continues to rise above 1.0400, boosted by a softer US Dollar and technical strength around significant Fibonacci levels. A sustained rally above 1.0450 may open the way for further advances towards the psychological 1.0500 level, with solid support at 1.0370 being essential to avoid downside risks. Market sentiment remains guarded, with worries about US policies, such as possible tariff proposals, contributing to the uncertainty. Traders will be keeping a close eye on these crucial technical levels and wider economic events, however, as a change in USD strength or policy stance would make the next EUR/USD direction potentially important. EUR/USD is defended at 1.0400 by a weakening USD and significant technical levels. Further advances can be expected should the pair break above 1.0450, with support standing firm at 1.0370. • The pair gains are maintained thanks to a softer US Dollar and technical support. • Breakout above the level may lead prices to the 1.0500 psychological level. • 50% Fibonacci retracement is essential support to arrest further decline. • Weaker US Dollar drives the recovery of the pair, but any change in sentiment may restrict gains. • Oscillators do not fully endorse a bullish bias, making traders cautious. • Ambiguity regarding tariff proposals and economic policy may trigger volatility. • A breakdown below 1.0370 may bring declines towards 1.0330, 1.0300, and lower supports. The EUR/USD currency pair is still underpinned by a softer US Dollar with market sentiment tilting towards optimistic caution. Economic uncertainties surrounding US policies and international trade conditions are still affecting investor sentiment. The recent USD weakness is due to the fears of economic stability and future policy changes, which have brought some comfort to the euro. As investors are realizing these events, overall economic trends and geopolitical tensions will be determinative forces in guiding the currency pair’s direction. EUR/USD Daily Price Chart Chart Source: TradingView Apart from currency flows, global market forces such as inflation patterns, central bank policies, and trade policies are major drivers to be monitored. The tariff and economic policy talks ongoing in the US provide an added layer of uncertainty, which would affect risk-taking appetite. On the other hand, investors are keeping a keen eye on the release of economic data and statements by major financial institutions, which will give us a clue on future market action. Under these conditions, a balanced strategy taking into account both economic underpinnings and geopolitics is still imperative for market players. TECHNICAL ANALYSIS EUR/USD has demonstrated strength above the 1.0400 level, with strong support at 1.0370 and strong resistance at 1.0450. The pair bounced recently off the 50% Fibonacci retracement point, hinting at a possible stabilization of price action. A continued break above the 1.0450 resistance, which coincides with the 23.6% Fibonacci level, would indicate further upside towards the psychological 1.0500 level. Momentum indicators are still contradictory, though, and warn against taking bold bullish positions. On the downside, a breakdown through 1.0370 may bring about further losses towards 1.0330 and 1.0300, underlining the significance of these technical levels in setting the direction for the next move. FORECAST EUR/USD remains above 1.0400, displaying signs of steadiness as the US Dollar falters. If the pair continues to maintain its trend, a breakout above the resistance level of 1.0450 could lead to more increases. This is also the 23.6% Fibonacci retracement level and a significant obstacle for bulls. A successful break beyond this level may propel the pair towards the 1.0500 psychological level, then the recent high of 1.0525-1.0530. Further upside, if market sentiment continues to be positive, may extend to 1.0550 and higher. On the flip side, 1.0370 is an important support level, coinciding with the 50% Fibonacci retracement. A fall below this may see enhanced selling pressure, driving the pair towards 1.0330 and 1.0300. Should bearish momentum hold, the following targets would include the 1.0285 area, with the February swing low at approximately 1.0210 afterward. A second drop would get EUR/USD to the 1.0180-1.0175 region, a two-year lows level. Levels to monitor, as any movement in USD strength or risk would trigger further downfall.

Read More
Currencies EUR/USD

EUR/USD Under Pressure: Trump Tariff Threats Shake Eurozone Markets

  • BY
  • February 27, 2025
  • 0 Comments

EUR/USD is under fresh pressure as the US’s former President Donald Trump once again threatens to slap 25% tariffs on Eurozone automobiles and other imports, driving the currency pair close to 1.0460. The US Dollar becomes a safe-haven in the face of rising trade tensions, though hopes of a June Federal Reserve rate cut cap its upside. While political instability in Germany and the weak economic performance in the Eurozone contribute to the woes of the Euro, investors now wait with bated breath for critical economic releases such as the US PCE inflation and initial HICP from the major Eurozone economies, which may also continue to sway sentiment. KEY LOOKOUTS • The proposal by the US President to apply 25% tariffs on cars in the Eurozone is worrying about trade tensions and regional economic growth. • Safe-haven appetite increases the USD, but hope for a June Federal Reserve rate cut may prevent its further gain. • The release of Friday’s preliminary HICP inflation figures in Germany, France, and Italy will inform expectations regarding the European Central Bank’s forthcoming monetary policy. • US Durable Goods Orders, Initial Jobless Claims, and the PCE inflation report are carefully followed by investors as gauges for the Fed’s future policy. EUR/USD continues to come under pressure as Trump’s fresh tariff threats against Eurozone imports add to trade tensions, increasing the safe-haven demand for the US Dollar. Nevertheless, anticipation of a June Federal Reserve rate cut caps the greenback’s gains. Meanwhile, uncertainty surrounding Germany’s coalition government and structural economic issues also continue to put pressure on the Euro. Investors shift their attention to important economic indicators, such as the US PCE inflation report and initial HICP inflation readings from major Eurozone economies, which will be instrumental in determining market mood and the European Central Bank’s monetary policy stance. EUR/USD falters as Trump’s threats of tariffs on the Eurozone increase the US Dollar’s safe-haven demand. Attention turns to US PCE inflation and Eurozone HICP data, which will shape the Federal Reserve and ECB’s monetary policy direction. • The US President intends to apply 25% tariffs to Eurozone vehicles, escalating trade tensions and economic uncertainty. • The pair declines close to 1.0460, dragged down by tariff concerns and deteriorating Eurozone economic conditions. • Safe-haven demand for the USD grows but is tempered by expectations of a June Fed rate cut that curb its potential. • Continuity of coalition government talks exacerbates the Euro’s woes and economic uncertainty. • German, French, and Italian HICP inflation prints on the way, which will guide ECB monetary policy expectations. • Durable Goods Orders and PCE inflation headlines will steer Fed rate views. • EUR/USD is getting major support at 1.0440, with a resistance level of 1.0630, while RSI indicates declining bullish momentum. EUR/USD is under pressure as trade tensions between the US and Eurozone rise following the fresh threats by former US President Donald Trump to impose 25% tariffs on European car imports. This has raised fears regarding the economic blow for the Eurozone, which is already reeling under poor demand and sluggish growth. In turn, a European Commission official threatened severe retaliatory action against any unwarranted trade restrictions. At the same time, political instability in Germany contributes to the region’s instability, with coalition talks prolonging economic uncertainty. Bundesbank President Joachim Nagel has called on the new German government to tackle structural vulnerabilities to enhance the country’s competitiveness. EUR/USD Daily Price Chart Chart Source: TradingView In the US, market participants are anxiously awaiting economic indicators that would determine the next policy action from the Federal Reserve. Although the US Dollar has strengthened on account of its safe-haven demand, hopes for a Fed rate cut in June still dominate sentiment. Latest economic data point to a moderation in US service sector growth and dipping consumer confidence, supporting expectations of monetary easing. While that is happening, investors are also waiting for crucial inflation readings such as the Personal Consumption Expenditures (PCE) Price Index, which is an important gauge of the Fed’s inflation expectations. Traders in the Eurozone are also watching out for the German, French, and Italian inflation data in the coming days, which will help decide the direction of European Central Bank’s future monetary policy. TECHNICAL ANALYSIS EUR/USD continues to trade in a narrow band around 1.0500, with the 50-day Exponential Moving Average (EMA) acting as solid support around 1.0440. The 14-day Relative Strength Index (RSI) floats below the 60.00 mark, showing no strong bullish momentum. A break above this level could instigate further bullish potential. On the negative side, the February 10 low of 1.0285 serves as a crucial support level, and resistance is at the December 6 high of 1.0630. A move above this resistance might solidify the position of the Euro, while a fall below the crucial support levels might accelerate selling pressure. FORECAST In case market sentiment turns positive for risk assets, EUR/USD might recover. A less firm US inflation reading, specifically a softer-than-anticipated PCE Price Index, might support the expectation of a Federal Reserve rate cut in June, which would put downward pressure on the US Dollar. And if Eurozone inflation readings surprise to the upside, it might make the case for the European Central Bank (ECB) to hold off on rate cuts even stronger, which would be bullish for the Euro. Any settlement or relief in trade tensions between the US and Eurozone can also give a boost to EUR/USD. A breakout above the crucial resistance of 1.0630 can pave the way for further advances. Conversely, ongoing trade uncertainty due to Trump’s tariff threats can also bear down heavily on the Euro, as the Eurozone economy is still fragile. Any indication of economic fragility in Germany, particularly from future inflation readings or coalition government instability, would also have a further bearish effect on sentiment towards the Euro. If US economic figures remain robust, corroborating the Fed’s conservatism in reducing interest rates, then the US Dollar could gain further support, driving EUR/USD down. A fall below the

Read More