EUR/USD Analysis Summary Today
- Overall Trend: Still in an upward trend.
- Support Levels for EUR/USD Today: 1.1680 – 1.1600 – 1.1550
- Resistance Levels for EUR/USD Today: : 1.1770 – 1.1830 – 1.1900
EUR/USD Trading Signals:
- Buy EUR/USD from the support level of 1.1630 with a target of 1.1820 and a stop-loss at 1.1560.
- Sell EUR/USD from the resistance level of 1.1810 with a target of 1.1500 and a stop-loss at 1.1900.
Technical Analysis of EUR/USD Today:
The EUR/USD continues to trade within a rebound zone despite recent selling pressure. The pair closed last week stable around the 1.1707 level after bulls failed to capitalize on a test of the 1.1800 psychological resistance. This followed market reactions to policy announcements from both the European Central Bank (ECB) and the Federal Reserve, alongside a batch of US economic releases that had been delayed by the longest government shutdown in US history.
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According to reliable trading platforms, the EUR/USD will remain supported as long as bulls can push toward the 1.1800 resistance again. The RSI (Relative Strength Index) is currently reading around 59, supporting a bullish outlook while awaiting strong positive momentum to confirm the upward trend. Quiet and limited movement is expected as the annual holiday season approaches. Conversely, a bearish scenario on the daily chart would require a return to the 1.1500 support area. No major economic data is expected today from either the Eurozone or the US; therefore, the pair will move based on recent drivers amid low liquidity and reduced risk appetite ahead of the holidays.
The Impact of Inflation Figures on the US Dollar
According to recent Forex market data, the US Dollar retreated after US inflation was announced at 2.7% year-on-year for November, down from 3% in October. this decline contradicted analyst expectations, which had predicted an increase to 3.1%. This suggests the Federal Reserve will feel more comfortable cutting US interest rates again in the coming months.
Influenced by the data release, the US dollar index, which measures the dollar's performance against other major currencies, fell to 98.20. The euro rose against the dollar to a high of 1.1750, while the British pound also reached a high of 1.3440.
According to the official announcement, the core inflation rate of the US Consumer Price Index (CPI) fell to 2.6% from 3.0% in October, a level that was expected to remain unchanged last month. Economists are treating lower-than-expected inflation with some skepticism, which may explain the dollar's recovery from some of its earlier losses. Fawad Razaqzadeh, an analyst at City Index, commented that there was some skepticism surrounding this particular inflation report, given the impact of the government shutdown on data collection. He added, “Therefore, it might be best for markets not to overreact to one month’s data and to wait for the December report, which is due in January.” However, markets are accepting today’s figures as they are, buying stocks and selling “safe havens” as investors grow more confident that the Federal Reserve will cut interest rates further.
Meanhwile, the Federal Reserve remains committed to a sustainable 2.0% inflation target while protecting the labor market. If the Fed believes inflation is under control, it will lower rates to support businesses and households. Typically, Expectations of lower rates lead to a weaker US Dollar.
Trading Advice:
Traders advise monitoring the EUR/USD's rise toward the 1.18 resistance to consider potential sell positions, provided risk management is strictly applied.
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