- The shared currency barely moves vs. the greenback as traders head into the weekend.
- The EU and the US reached an agreement on natural gas supply.
- EUR/USD Price Forecast: Confined to the 1.0960-1.1000 range.
The EUR/USD remains subdued amid a choppy trading day, as the market mood swings from risk-on to off continue, on “hawkish” comments by Fed officials, stagnate peace talks discussions of Russia and Ukraine, and an attack on Saudi Arab Aramco installations on Friday. At 1.0992, the EUR/USD shows the resilience of the greenback, despite being softer in the day.
As the New York session progresses, the market sentiment is mixed. European and US equity indices fluctuate between gainers and losers, while the US Dollar Index, a gauge of the greenback’s value vs. a basket of six currencies, is barely flat at 98.787.
Russia – Ukraine and NATO updates
Meanwhile, the war in Eastern Europe extends to a whole month of hostilities between Russia and Ukraine. Although there have been peace discussions, both parties have disagreed on the primary issues, as said by the Russian negotiator, early in the day on wires. He added that Russia and Ukraine are getting closer on secondary matters. At the same time, NATO’s summit in Brussels came to an end, with the US and Europe reaching an agreement on natural gas so that Europe would cut energy dependence on Russia.
Although the news is good for the Eurozone, the EUR/USD failed to react positively to it, as the pair stays parked at the 1.0980-1.1000 area.
US commercial banks expect two 50-bps hikes
Earlier in the day, Citigroup and Goldman Sachs analysts expected that the Federal Reserve would hike 50-bps in the two following meetings, in May and June.
On the US front, Fed speaking continues with the New York Fed President John Williams also backing up a 50 bps increase, and he stated, “If it is appropriate to raise by 50 basis points at a meeting, I will do that.”
The US economic docker featured Pending Home Sales for February shrank 4.1% from a 1% m/m increase estimated. Furthermore, the University of Michigan Consumer Sentiment Final for March came at 59.4 from 59.7, while inflation expectations stayed at 5.4% vs. 4.9% on the previous report.
EUR/USD Price Forecast: Technical outlook
The EUR/USD is still downward biased, though, in the last four trading days, the EUR/USD has been trading in a narrow range, between 1.0960-1.1000. The lack of a catalyst, plus fluctuations in the market mood, might keep the shared currency trendless.
That said, the EUR/USD first support would be 1.0960. Breach of the latter would expose 1.0900, followed by the YTD low at 1.0806. On the flip side, the EUR/USD first resistance would be 1.1000. Once cleared, the next resistance would be 1.1050, followed by 1.1100.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD stays weak near 1.0400 as trading conditions thin out
EUR/USD trades with mild losses near 1.0400 on Tuesday. The expectation that the US Federal Reserve will deliver fewer rate cuts in 2025 provides some support for the US Dollar. Trading volumes are likely to remain low heading into the Christmas break.
GBP/USD consolidates below 1.2550 on stronger US Dollar
GBP/USD consolidates in a range below 1.2550 on Tuesday, within striking distance of its lowest level since May touched last week. The sustained US Dollar rebound and the technical setup suggest that the pair remains exposed to downside risks.
Gold holds above $2,600, bulls non-committed on hawkish Fed outlook
Gold trades in a narrow channel above $2,600 on Tuesday, albeit lacking strong follow-through buying. Geopolitical tensions and trade war fears lend support to the safe-haven XAU/USD, while the Fed’s hawkish shift acts as a tailwind for the USD and caps the precious metal.
IRS says crypto staking should be taxed in response to lawsuit
In a filing on Monday, the US International Revenue Service stated that the rewards gotten from staking cryptocurrencies should be taxed, responding to a lawsuit from couple Joshua and Jessica Jarrett.
2025 outlook: What is next for developed economies and currencies?
As the door closes in 2024, and while the year feels like it has passed in the blink of an eye, a lot has happened. If I had to summarise it all in four words, it would be: ‘a year of surprises’.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.