The EUR/USD started the week with a slight rebound from its recent lows. However, the pair remains under pressure due to a strong US dollar and economic concerns in the eurozone. With key economic data expected this week, traders are preparing for potential market moves.
Bearish trends persist
The EUR/USD started the week on a positive note, rebounding from last week’s lows around 1.0448—a crucial level last seen in April 2023.
The pair continues to face bearish pressure due to a strong US dollar and ongoing eurozone economic challenges. Key support is identified at 1.0425, while resistance is near 1.0500.
EUR/USD stabilises near 1.0480, rebounding from lowes as it approaches resistance amid cautious market optimism, as seen on the VT Markets app.
Traders are closely monitoring this week’s inflation reports and US consumer confidence data, as these could determine the pair’s next directional move.
The euro’s ability to maintain levels above 1.05 will depend on shifts in market sentiment and the influence of upcoming US economic updates.
Leadership shifts and market sentiment
The euro gained some relief following Scott Bessent’s appointment as the new US Treasury Secretary.
While his leadership has temporarily alleviated concerns over inflation tied to Trump’s fiscal policies, caution persists.
Expectations of aggressive economic strategies under Trump continue to weigh on market sentiment.
Bessent’s role has led to a pullback in Treasury yields, giving the euro a brief reprieve.
However, the eurozone’s economic outlook remains fragile, with weakening export demand and declining business sentiment adding to the region’s challenges.
The ECB cautioned that the the euro zone could be facing another debt crisis if the bloc cannot boost growth, lower public debt and fix policy uncertainty. Nomura’s George Buckley takes stock of what the bloc faces pic.twitter.com/ZTYcRXxDE5
Despite the euro’s recent recovery, the US dollar continues its strong upward trajectory.
The dollar index has posted gains for eight consecutive weeks, driven by expectations of Trump’s pro-growth fiscal measures.
Upcoming US releases to watch
Critical US economic reports this week, including Q3 GDP figures, core PCE inflation data, and the FOMC minutes, are likely to influence the pair’s movement.
With the Thanksgiving holiday approaching, these events could significantly impact EUR/USD dynamics.
