EUR/USD rises as US Dollar declines with US presidential voting begins


  • EUR/USD rises to near 1.0900 as the US presidential elections kicks-off, which will influence market sentiment.
  • Investors expect a neck-to-neck competition between Kamala Harris and Donald Trump.
  • The ECB is expected to cut interest rates by 25 bps in the December meeting.

EUR/USD gains to near 1.0890 in Tuesday’s New York session. The major currency pair remains shy of the key resistance of 1.0900 on the United States (US) presidential election day. The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, extends its downside to near 103.60.

The Greenback exhibited a strong buying trend in October as traders were pricing in former US President Donald Trump’s victory. However, it struggles to extend its upside further as traders expect tough competition between Trump and current Vice President Kamala Harris now. The likelihood of Trump’s victory has witnessed a pullback after the Des Moines Register/Mediacom Poll showed Harris gaining a slight lead of three points in Iowa state, where the Republican party gained a clear majority in 2016 and 2020.

“A Red Wave (favoring Republicans) would kick-start a sizeable USD rally. It would rekindle memories of US Exceptionalism, anchored by tariffs, tax cuts, deregulation, and negative impacts on the outlook for EZ and China," according to analysts at TD Securities.

While the US presidential election will be the key event for the US Dollar this week, investors will also pay close attention to the Federal Reserve’s (Fed) monetary policy decision, which will be announced on Thursday. The Fed is expected to reduce interest rates by 25 basis points (bps) to 4.50%-4.75%, according to the CME FedWatch tool. Investors will focus on Fed Chair Jerome Powell's speech for fresh cues over likely monetary policy action in December.

On the economic data front, investors await the US ISM Services Purchasing Managers Index (PMI) data for October, which will be published at 15:00 GMT. The Services PMI is estimated to come in at 53.8, lower than 54.9 in September, suggesting that the activities in the service sector expanded but at a slower pace.

Daily digest market movers: EUR/USD gains sharply as US Dollar slumps

  • EUR/USD stays firm after the opening of polls for US election voting. The major currency pair is expected to be mainly guided by the US Dollar in an event-packed week. 
  • While the Euro (EUR) struggles for direction against the US Dollar, it performs weakly against Asia-Pacific currencies after upbeat Caixin Manufacturing and Services PMI. Still, it outperforms other major currencies as traders pare European Central Bank (ECB) dovish bets.
  • Market participants expect the ECB to cut the Deposit Facility Rate again in December by a usual size of 25 bps. Earlier, investors were anticipating a 50-bps interest rate cut by the ECB in its last policy meeting of the year as few officials highlighted growing risks to economic growth and emphasized the need for large economic stimulus to boost domestic spending and investment.
  • ECB’s large rate cut bets diminished after better-than-expected Eurozone Q3 Gross Domestic Product (GDP) growth, which receded fears of an economic downturn. Meanwhile, revised German and Eurozone HCOB Manufacturing PMI estimates have improved against flash readings. However, the manufacturing output index remained below the 50.0 threshold, suggesting that the contraction trend remains intact.

Euro PRICE Today

The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the US Dollar.

  USD EUR GBP JPY CAD AUD NZD CHF
USD   -0.31% -0.51% -0.21% -0.34% -0.77% -0.62% -0.11%
EUR 0.31%   -0.20% 0.10% -0.03% -0.49% -0.31% 0.20%
GBP 0.51% 0.20%   0.28% 0.15% -0.30% -0.12% 0.40%
JPY 0.21% -0.10% -0.28%   -0.12% -0.56% -0.43% 0.10%
CAD 0.34% 0.03% -0.15% 0.12%   -0.44% -0.29% 0.23%
AUD 0.77% 0.49% 0.30% 0.56% 0.44%   0.15% 0.67%
NZD 0.62% 0.31% 0.12% 0.43% 0.29% -0.15%   0.51%
CHF 0.11% -0.20% -0.40% -0.10% -0.23% -0.67% -0.51%  

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).

Technical Analysis: EUR/USD aims to establish above 1.0900

EUR/USD struggles for an establishment above the immediate resistance of 1.0900, which also aligns with the 200-day Exponential Moving Average (EMA). The pair rebounded sharply towards the end of October after gaining a firm footing near an upward-sloping trendline around 1.0750, which is plotted from the April 16 low at around 1.0600

The 14-day Relative Strength Index (RSI) climbs to near 50.00, suggesting some signs of a bullish reversal. However, this will only be confirmed if the RSI (14) climbs above 60.0 decisively.

Looking up, if the shared currency pair breaks above the 200-day EMA around 1.0900, it could rise to near the September 11 low around 1.1000. On the downside, the October 23 low of 1.0760 will be the key support area for the Euro bulls.

 

Share: Feed news

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


Recommended content

Editors’ Picks

EUR/USD trades at yearly lows below 1.0500 ahead of PMI data

EUR/USD trades at yearly lows below 1.0500 ahead of PMI data

EUR/USD stays on the back foot and trades at its lowest level since October 2023 below 1.0500 early Friday, pressured by persistent USD strength. Investors await Manufacturing and Services PMI surveys from the Eurozone, Germany and the US.

EUR/USD News
GBP/USD falls to six-month lows below 1.2600, eyes on key data releases

GBP/USD falls to six-month lows below 1.2600, eyes on key data releases

GBP/USD extends its losses for the third successive session and trades at a fresh fix-month low below 1.2600. This downside is attributed to the stronger US Dollar (USD) as traders continue to evaluate the Fed's policy outlook following latest data releases and Fedspeak.

GBP/USD News
Gold rises toward $2,700, hits two-week top

Gold rises toward $2,700, hits two-week top

Gold continues to attract haven flows for the fifth consecutive day and rises toward $2,700. XAU/USD continues to benefit from risk-aversion amid intensifying Russia-Ukraine conflict. Investors keep a close eye on geopolitics while waiting for PMI data releases. 

Gold News
Ripple surges to a new yearly high; XRP bulls aim for three-year high of $1.96

Ripple surges to a new yearly high; XRP bulls aim for three-year high of $1.96

Ripple extends its gains by around 10% on Friday, reaching a new year-to-date high of $1.43 and hitting levels not seen since mid-May 2021. The main reasons behind the rally are the announcement that the US SEC's Chair Gary Gensler will resign and the launch in Europe of an XRP  ETP by asset management company WisdomTree.

Read more
A new horizon: The economic outlook in a new leadership and policy era

A new horizon: The economic outlook in a new leadership and policy era

The economic aftershocks of the COVID pandemic, which have dominated the economic landscape over the past few years, are steadily dissipating. These pandemic-induced economic effects are set to be largely supplanted by economic policy changes that are on the horizon in the United States.

Read more
Best Forex Brokers with Low Spreads

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.

Read More

Forex MAJORS

Cryptocurrencies

Signatures