EUR/USD snaps four-day winning streak, but call options continue to gain value

Monday's inverted hammer candle indicates EUR/USD's rally has likely run out of steam.
Options market continues to add bullish bets, suggesting a continuation of the rally.

Omkar Godbole FXStreet Contributor

EUR/USD fell 0.18% on Monday, snapping the four-day winning streak.

Notably, the pair formed an inverted hammer on Monday, signaling the rally from Oct. 1's low of 1.0879 has run out of steam.

Also, Monday's candlestick pattern has made today's close pivotal. A bearish reversal would be confirmed if the spot ends below Monday's low of 1.1139. Meanwhile, a close above Monday's high of 1.1179 would mean a continuation of the rally.

A bullish close looks likely, according to the options market. One-month risk reversals, a gauge of calls to puts on the common currency, jumped to 0.162 on Monday, the highest level since July 22. The positive number indicates the implied volatility premium for calls (bullish bets) is higher than that for puts (bearish bets).

Put simply, investors added a premium for calls (added bullish bets) despite the pullback in the spot.

Further, the risk revival seen in the stock markets, possibly due to the easing of US-China trade tensions, could bode well for the common currency.

As of writing, EUR/USD is trading largely unchanged on the day at 1.1150.

The pair may suffer a bearish close if the UK's parliament does not agree to the Brexit timetable, possibly leading to a drop in GBP/USD. The 115-page Brexit bill published by the UK government on Monday will get its second reading in the House of Commons on Tuesday.

EUR1MRR

Technical levels

EUR/USD

Overview
Today last price	1.1149
Today Daily Change	-0.0001
Today Daily Change %	-0.01
Today daily open	1.115

Trends
Daily SMA20	1.1006
Daily SMA50	1.1037
Daily SMA100	1.1138
Daily SMA200	1.1209

Levels
Previous Daily High	1.118
Previous Daily Low	1.1138
Previous Weekly High	1.1063
Previous Weekly Low	1.0941
Previous Monthly High	1.111
Previous Monthly Low	1.0885
Daily Fibonacci 38.2%	1.1154
Daily Fibonacci 61.8%	1.1164
Daily Pivot Point S1	1.1132
Daily Pivot Point S2	1.1115
Daily Pivot Point S3	1.1091
Daily Pivot Point R1	1.1173
Daily Pivot Point R2	1.1197
Daily Pivot Point R3	1.1215

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

EUR/USD looks apathetic around 1.1770

EUR/USD comes under renewed pressure on Tuesday, deflating below the 1.1800 support and reversing two consecutive days of gains. The pair’s decline follows the persistent move higher in the US Dollar, as trade uncertainty dominates the sentiment ahead of President Trump’s SOTU speech.

GBP/USD regains 1.3500 and above

GBP/USD extends its advance for the third day in a row on Tuesday, this time retesting the area beyond the 1.3500 hurdle. Cable’s uptick comes despite decent gains in the Greenback and the dovish message from the BoE’s Bailey at the UK Parliament.

Gold appears offered around $5,150

Gold is giving back a good portion of the recent multi-day rally, receding to the $5,150 zone per troy ounce amid the decent bounce in the US Dollar and mixed US Treasuty yields. In the meantime, markets’ attention remain on upcoming comments from Fed speakers.

Crypto Today: Bitcoin, Ethereum, XRP come under renewed pressure amid ETF outflows, tariff uncertainty

Bitcoin, Ethereum and Ripple are trading under increasing selling pressure at the time of writing on Tuesday, as market participants navigate renewed tariff uncertainty. The Crypto King holds above $63,000, down 2% intraday from its $64,656 open.

The Citrini report: How a debatable AI narrative can shake Wall Street

That AI-related headline alone was enough to rattle investors.US stocks slid sharply on Monday after a widely circulated Citrini Research memo outlined a hypothetical “2028 Global Intelligence Crisis”, warning that rapid AI adoption could push US unemployment into double digits as early as by mid-2028.

XRP pressured by weak ETF flows and declining retail interest

Ripple (XRP) is edging lower, trading above its intraday low of $1.32 at the time of writing on Tuesday. The decline from its weekly opening of $1.39 reflects heightened volatility in the broader cryptocurrency market, accentuated by tariff-triggered uncertainty.