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Currencies EUR/USD

EUR/USD Rises on Hopes of Ukraine Peace, but ECB Policy and Tariff War Risks Lurk

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  • March 4, 2025
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EUR/USD keeps rising towards the 1.0500 level on hopes of a possible Ukraine peace agreement. Yet, the pair’s rally is capped by increased global risk aversion amid heightened trade tensions. US President Donald Trump has increased tariffs on Chinese imports to 20%, and Canada and China have responded with retaliatory actions. Moreover, the US has suspended all military assistance to Ukraine, further adding to geopolitical volatility. In the meantime, the Euro can expect additional pressure before the European Central Bank (ECB) meeting, when a widely anticipated rate cut can weigh on the currency. Sidelined US economic data have also added to market uncertainty, leaving traders hesitant to bet on the near-term outlook of the Euro. KEY LOOKOUTS • Optimism regarding a formal Ukraine peace plan is supportive of EUR/USD, but uncertainty prevails as the US suspends military aid to Ukraine. • Trump’s China tariff increases and possible retaliatory actions by Canada and China may spark risk aversion, capping the Euro’s upside potential. • The European Central Bank will likely reduce rates again, which may put pressure on the Euro and affect EUR/USD’s short-term direction. • Disagreement on US manufacturing data contributes to market uncertainty, making investors wary of the Federal Reserve’s next step and dollar strength. EUR/USD is still in the spotlight as hopes for a Ukraine peace agreement offer support, but rising global trade tensions and policy risks cap further advances. The US has suspended all military aid to Ukraine at the direction of President Trump, contributing to geopolitical uncertainty. While Trump’s move to increase tariffs on Chinese imports to 20% has prompted threat of retaliation from Canada and China, it is adding to risk aversion. The European Central Bank meeting also looms as a major trigger, with an expected rate cut that can depreciate the Euro. Also, conflicting US economic data have put investors in confusion regarding the direction of Federal Reserve policy, which is keeping the currency market nervous. EUR/USD rises on optimism for Ukraine peace agreement but tests resistance as global risk aversion increases. A further escalation in US-China trade tensions and the anticipated ECB rate cut may act as a dampener for the Euro. Heterogeneous US economic data brings more uncertainty to the table, maintaining market mood cautious. • The pair extends its rally at 1.0500 with support from hope for a Ukraine peace agreement. • The US suspended all military aid to Ukraine, further fuelling world tensions and market conservatism. • Trump increases tariffs on Chinese imports to 20%, inviting retaliatory threats from Canada and China, elevating risk aversion. • The European Central Bank will likely lower the Deposit Facility Rate by 25 bps, possibly putting pressure on the Euro. • Conflicting US economic indicators, such as a softer ISM Manufacturing PMI and a firmer S&P Global PMI, contribute to investor uncertainty. • Risk sentiment and policy issues may limit further gains in the Euro despite recent rallies. • Ongoing uncertainty regarding the Federal Reserve’s policy path keeps traders on their toes, influencing EUR/USD price action. Global markets are in suspense as geopolitical tensions and trade conflicts define the economic environment. Hopes for a formal Ukraine peace agreement have arisen, with European leaders and Ukrainian President Volodymyr Zelenskyy negotiating a plan to be presented to the US. However, doubts intensified as the US government suspended all military assistance to Ukraine, fuelling fears over long-term stability in the region. Meanwhile, trade tensions between economies increased, with President Trump increasing tariffs on Chinese goods, and China strongly opposing, with possible retaliatory measures from Canada. These events underscore the increasing polarization in global relations, impacting investor sentiment and economic policies across the globe. EUR/USD Daily Price Chart Chart Source: TradingView On the economic side, policymakers and market players are keeping a close eye on the European Central Bank’s next meeting, where a possible rate cut is anticipated. Such monetary policy has a significant impact on financial planning and world economic growth. In the US, meanwhile, conflicting economic data have contributed to the uncertainty, with varying indicators of manufacturing performance capturing the difficulty of sustaining stability in a volatile environment. While global economies ride this ride, companies and governments have to be flexible to changing economic circumstances and global policy measures. TECHNICAL ANALYSIS EUR/USD is stuck around 1.0500, with risk aversion cappping its upside. The pair has been on the verge of consolidation, with market players keenly observing key resistances and supports for signs of a breakout. Moving averages are bearish, while momentum indicators such as the RSI and MACD are indicative of indecisiveness in market sentiment. A break above near-term resistance could set the stage for additional gains, while inability to maintain key support levels could prompt a pullback. Technical signals overall point to EUR/USD being in a precarious area, waiting for a more robust catalyst for directional momentum. FORECAST EUR/USD may rise further if sentiment towards the Ukraine peace agreement gets a boost, which would enhance market risk appetite. A diplomatic settlement would alleviate geopolitical risk, potentially strengthening the Euro. Also, if economic statistics from the Eurozone are stronger than anticipated or the European Central Bank (ECB) is less dovish than anticipated, the pair could get further backing. Any US dollar weakness caused by changing Federal Reserve policy or weaker economic data would also provide space for a move upwards. A move above major resistance levels might drive the pair to higher price ranges in the near future. EUR/USD is subject to several downside threats that would limit its momentum. Increased risk aversion as a result of rising trade tensions—like Trump’s raised tariffs on China and possible retaliations from Canada and China—may support the US dollar, which would bear down on the Euro. If the ECB acts on a highly anticipated rate cut or hints at more monetary easing, the Euro could fall as well. Any better-than-expected US economic data would be supportive of the dollar’s advance, which would see the pair fall. A breakdown of crucial support levels could lead to more losses, leaving

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Commodities Gold

Gold prices surged past $2,900: Trump’s tariffs and global uncertainty fuel safe-haven demand

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  • February 11, 2025
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Gold price (XAU/USD) continues its bullish momentum, breaching the $2,900 mark to hit a fresh all-time high amidst growing safe-haven demand. The surge is driven by US President Donald Trump’s new tariffs on commodities, escalating global trade war concerns, and geopolitical tensions, particularly in the Middle East. Other positives include the prospect of increasing inflation with the pro-protectionist policies of President Trump, thus making gold more attractive as an economic uncertainty hedge. A weak US Dollar bounce and an overbought market have resulted in some intraday profit-taking before Fed Chair Jerome Powell’s congressional testimony. Even though the precious metal experienced some minor pullbacks, the bigger picture is bullish, and strong support is at key technical levels above $2,800, which supports additional upside. KEY LOOKOUTS • Global uncertainty rises with threats of US retaliation and reciprocal tariffs on commodities • Increasing skirmishes, in the Middle East for one, only heighten fears in markets that drive even greater demand for gold as an inflation hedge against volatility • Fed rate policy and future course under inflation concern and a surprising strong labor market. • Despite minor pullbacks, gold’s strong support above $2,800 and bullish trends suggest further upside potential in the coming sessions. Gold’s bullish momentum remains intact as it continues to trade above the $2,900 mark, driven by escalating trade war fears following Trump’s new tariffs and ongoing geopolitical tensions. Investors are turning to the safe-haven metal amid uncertainties surrounding global economic policies and Middle East conflicts. A stronger US Dollar and profit-taking have caused slight pullbacks, but gold’s strong technical support near $2,800 suggests limited downside risks. The market now awaits Fed Chair Jerome Powell’s testimony, which could provide further clarity on the Federal Reserve’s rate stance and influence gold’s next move. Gold price continues to hold strong above $2,900 on the back of Trump’s tariffs and geopolitical tensions, which increase safe-haven demand. Even minor pullbacks are capped by strong support near $2,800. Fed Chair Powell’s testimony may shape gold’s next move. • Gold price surges to a record high as safe-haven demand increases. • New US tariffs on commodities raise the specter of a global trade war, making gold more attractive. • Uncertainties, especially in the Middle East, push investors towards gold as a hedge. • Expectations of inflation because of Trump’s protectionist stance might influence the rate decisions of the Federal Reserve. • A modest recovery in the USD results in some profit-taking in the prices of gold. • Gold is well-supported above $2,800 and is limited in downside risks despite minor corrections. • Investors await Fed Chair Jerome Powell’s comments, which may affect the future course of gold. Gold’s price keeps on its bullish trend, going past the $2,900 mark and reaching a new all-time high as investors seek safety amid rising economic and geopolitical uncertainties. US President Donald Trump’s newly imposed tariffs on commodities, along with his plans for reciprocal duties on other countries, have fueled fears of a global trade war, significantly boosting demand for gold. Furthermore, increased political tensions, especially in the Middle East, have also contributed to gold’s safe-haven status. However, some intraday profit-taking occurred due to a minor US Dollar recovery. Yet, the bullish sentiment remains firm, with technical support levels around $2,800 capping the downside. XAU/USD Daily Chart TradingView Prepared by ELLYANA Looking ahead, market participants are watching the Federal Reserve’s policy stance very closely as Trump’s protectionist policies are likely to drive inflation higher, and this might have an impact on the Fed’s interest rate decisions. A hawkish stance from the central bank would strengthen the US Dollar and cap gold’s gains, while a dovish approach would further support the yellow metal’s rally. Investors are also waiting for Fed Chair Jerome Powell’s congressional testimony, which may give a clue about the Fed’s view on inflation and interest rates. While short-term fluctuations are possible, the broader technical setup suggests that gold is still on an uptrend, and strong demand is likely to keep prices elevated in the near term. TECHNICAL ANALYSIS Gold is still in a strong uptrend, comfortably above the $2,900 level, and with key support around the $2,800 level. Any pullback towards $2,886-$2,882 should attract fresh buying interest, which will reinforce the bullish outlook. A decisive break below this zone may push prices towards the $2,855-$2,852 region, but downside risks are limited because of strong demand. On the flip side, yesterday’s resistance came in near $2,943-$2,950; a next leg higher probably targets the $3,000 mark, but it is reflected in the daily chart – the overbought Relative Strength Index (RSI). The next leg higher might mean some consolidation or short-term correction. Traders will look forward to Fed Chair Jerome Powell’s testimony and the US Dollar’s movement for further directional cues. FORECAST The medium-term bullishness in gold will likely continue for the near term, with price action testing new higher resistance levels. If this buying pressure remains strong, then the next target to the upside would be in the $2,943-$2,950 area, with the psychological $3,000 barrier being a major obstacle before breaking above to start a new rally and take the long-term uptrend much further. Geopolitical tensions, inflation fears, and safe-haven demand will continue to fuel gold prices. The positive view on the yellow metal will continue. But, the price may see some pullbacks because of profit-taking and the US Dollar’s strengthening. If the price falls below $2,900, the initial support is seen around $2,886-$2,882, and the downside risks will extend toward the $2,855-$2,852 zone. Another more aggressive push in correction would push prices closer to the $2,834 level, but that level is expected to attract buyers, thus limiting further declines. Market sentiment will be highly driven by the monetary stance of the Federal Reserve and Jerome Powell’s testimony as any hints of a prolonged rise in higher interest rates would force short-term downward pressure on gold.

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Currencies EUR/USD

EUR/USD Rebounds Amid Trump’s Tariff Threats: Uncertainty Looms Over Global Trade

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  • February 10, 2025
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EUR/USD rebounded above 1.0300 after an initial dip, but market uncertainty remains as investors react to US President Trump’s renewed tariff threats on steel and aluminum imports. The Euro faces additional pressure from potential trade tensions with the US and concerns over the ECB’s ability to support inflation. The speech of ECB President Christine Lagarde and testimony by Fed Chair Jerome Powell can drive monetary policy expectations. On the technical side, EUR/USD seems to have difficulty around resistance at 1.0500. More importantly, a strong support line remains at 1.0177 that could make or break the pair’s next move. KEY LOOKOUTS • Rekindled fears of the trade war on steel and aluminum imports at 25% tariffs have impacted the global markets and the stability of the Euro. • Investors await ECB President Christine Lagarde’s remarks on monetary policy and economic outlook, which could influence EUR/USD movements and market sentiment. • Federal Reserve Chair Jerome Powell’s congressional testimony may provide crucial insights into the US central bank’s interest rate stance, affecting the USD’s strength. • EUR/USD faces strong resistance near 1.0500, while key support at 1.0177 remains critical for determining the pair’s next directional move. EUR/USD recovers above 1.0300, but uncertainty lingers as Trump’s proposed 25% tariffs on steel and aluminum imports fuel trade war fears. Investors remain cautious ahead of ECB President Christine Lagarde’s speech and Fed Chair Jerome Powell’s testimony, both of which could influence monetary policy expectations. The Euro faces additional pressure from trade tensions with the US and weak inflation concerns in the Eurozone. Meanwhile, technical indicators show the pair struggling near resistance at 1.0500, with key support at 1.0177 shaping its next directional move. EUR/USD rebounds above 1.0300 despite uncertainty from Trump’s tariff threats on steel and aluminum imports. Investors await ECB Lagarde’s speech and Fed Powell’s testimony for monetary policy cues. The pair faces resistance at 1.0500, while key support lies at 1.0177. • The pair recovers above 1.0300 despite initial weakness driven by renewed US tariff fears. • Proposed 25% tariffs on steel and aluminum imports raise concerns over global trade tensions and impact market sentiment. • Investors await ECB President Christine Lagarde’s speech for insights into the Eurozone’s monetary policy and economic outlook. • The Federal Reserve Chair’s testimony before Congress may provide crucial signals on future interest rate decisions. • The US Dollar Index wobbles around 108.20, maintaining strength on global trade war fears. •The Euro faces additional strain from potential reciprocal tariffs and weaker-than-expected inflation levels. • EUR/USD struggles near 1.0500 resistance, while key support at 1.0177 remains crucial for the pair’s next move. EUR/USD rebounded above 1.0300 in Monday’s European session following a weak open as renewed fears over US President Trump’s 25% proposed tariffs on imports of steel and aluminum reignite the specter of a global trade war and weigh on the market sentiment that increases demand for safe-haven assets. The investors are closely following ECB President Christine Lagarde speech at the European Parliament and Fed Chair Jerome Powell testimony, which could affect the expectations over monetary policy. Meanwhile, the US Dollar Index stays strong near 108.20 due to still uncertain global markets. EUR/USD Daily Chart TradingView Prepared by ELLYANA Trade tensions, softer inflation than expected in the Eurozone, and the likelihood of additional rate cuts from the ECB are weighing on EUR/USD. The Euro remains vulnerable as economic contraction risks persist, and analysts warn that the US tariff measures could further hurt the European economy. Technical indicators show the pair struggling near resistance at 1.0500, with key support at 1.0177 playing a crucial role in determining the next directional move. Traders will also look to US CPI data, which will be released later this week, and how that will influence the Federal Reserve’s interest rate stance and the US Dollar’s strength. TECHNICAL ANALYSIS EUR/USD is trading around 1.0300, and resistance is located near the 50-day Exponential Moving Average (EMA) at 1.0436, while support is found at 1.0177. The 14-day Relative Strength Index (RSI) remains in the 40-60 range, showing a neutral trend with no clear directional momentum. A break above 1.0500 could trigger further gains, while a decline below 1.0177 may push the pair towards 1.0100. Market participants are watching upcoming economic events for clues on future movements, with the pair likely to stay range-bound unless a strong catalyst emerges. FORECAST EUR/USD has the potential to rise if it manages to break above the 50-day EMA at 1.0436, with the next resistance at the psychological level of 1.0500. A decisive push above this region would lead to further strides towards 1.0600, lifted by enhancing Eurozone economic performance data or more dovish US Federal Reserve statements. Another boost comes in case ECB President Christine Lagarde exudes confidence in the current stability of the Eurozone’s economy or gives hints of more tempered rate cuts that might make the Euro regain its strength. A weaker US Dollar, due to either lower-than-expected US inflation data or dovish comments from Fed Chair Jerome Powell, will add further fuel to the upside in EUR/USD. Downside risks include a failure for EUR/USD to hold above 1.0300, where it could face immediate support at 1.0177 (January 13 low) and further declines toward the critical 1.0100 level. A break below 1.0100 could see a test of parity (1.0000) as renewed global trade war fears, following Trump’s tariff threats or worsening Eurozone economic conditions, weigh on the pair. Deeper losses for EUR/USD could be seen if the ECB turns dovish and cuts rates aggressively in response to weak inflation or if the US Dollar strengthens on hawkish Fed comments. Further, geopolitical uncertainty or adverse economic surprise from the Eurozone might hasten the bearish thrust.

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