EUR/USD Steady Amid US Shutdown and Recent Mixed Economic Data
EUR/USD is trading slightly higher at 1.1745 as the Euro receives some limited support from strong Eurozone PMIs, while the US Dollar is under pressure following a third-day government shutdown and mixed US economic data. US ISM Services PMI declined to 50.0, indicating weakening services activity and demand for labor, while S&P Global Services and Composite PMIs revealed only slight dips. In parallel, Eurozone HCOB Composite and Services PMIs rose slightly, showing consistent but sluggish growth. Market mood is also shaped by dovish remarks from Fed officials and reassurances from ECB management, keeping the pair contained during the week. KEY LOOKOUTS • Political stalemate may continue to drag on the US Dollar and shape EUR/USD sentiment. • Monitor future PMI releases, employment data, and inflation measures to assess US growth momentum. • Any surprise in Eurozone PMI or inflation numbers may offer a boost to the Euro. • Rate policy and economic outlook comments by the Fed and ECB will continue to be market direction drivers. EUR/USD stays closely tied to 1.1745 as the market deliberates on conflicting economic indications from across the Atlantic. Weaker US numbers, such as the drop in the ISM Services PMI and extended shutdown of the government, have been pressuring the Greenback, and Eurozone PMIs indicating modest growth and continued resilience have EUR/USD holding at the middle of this week’s range. Traders are also closely observing central bank indicators, with dovish comments from the Fed pitted against ECB declarations of economic stability, leaving the pair locked in this week’s trading range. EUR/USD stays close to 1.1745 as a weaker US Dollar is countered by modest Eurozone growth. Attention in markets stays on US government shutdown updates, PMIs, and central bank projections. • EUR/USD around 1.1745, +0.22% higher today. • US ISM Services PMI declined to 50.0 in September, indicating weakening services activity. • S&P Global Services PMI softened modestly to 54.2, still in expansionary territory. • Eurozone HCOB Composite PMI increases to 51.2, which shows gentle growth. • Eurozone Services PMI up at 51.3, only a little short of expectations. • US Dollar pressured as government shutdown on day three, striking the DXY around 97.75. • Central bank comments: Fed reserved about rate cuts, ECB shows Eurozone stability. EUR/USD has been trading steadily near 1.1745 as market players evaluate economic events both in the US and Eurozone. The US Dollar is weakening on the back of the prolonged government shutdown, raising concerns regarding short-term fiscal stability and economic growth. On the other hand, the mixed US data, such as a weaker services activity and muted labor demand, have supported nervous sentiment among traders. EUR/USD Daily Chart Price SOURCE: TradingView On the continent, the Euro has been moderately supported by the bettering economic metrics. Eurozone PMIs such as the HCOB Composite and Services indexes have recorded consistent improvement, hinting at private sector resilience within the region. Central bank comments have also shaped sentiment, with Fed officials showing caution regarding rate cuts and ECB leadership touting the relative stability of the Eurozone, keeping the EUR/USD currency pair range-bound during the week. TECHNICAL ANALYSIS EUR/USD is trading in a tight range of 1.1700–1.1750, reflecting indecision in the market in response to contradictory economic indicators. Major support is around 1.1700, while resistance is at 1.1755–1.1760. Short-term moving averages are trending flat, reflecting little momentum, while the Relative Strength Index (RSI) is approaching neutral, with neither overbought nor oversold conditions in sight. Traders will be looking for a move above resistance or below support to set the next direction. FORECAST EUR/USD is expected to remain supported at 1.1700 if economic weakness in the US and the government shutdown continue, which should keep the Greenback in bearish clutches. Further evidence of cooling US services activity or weaker labor data could cause traders to prefer the Euro, which might drive the pair towards the top of this week’s range of 1.1755–1.1760. On the other hand, a solution to the US shutdown or better-than-expected US economic releases would support the Dollar, placing additional downward pressure on EUR/USD. Under such circumstances, the pair might again test support levels around 1.1700, and continued US economic strength could precipitate a sharper correction to 1.1680 or lower.