FX.co ★ EUR/USD

The spot price recently hit a fresh 13-month low, dipping near 1.0900 during last week’s trading session. The price came under pressure after the data for October indicated stronger-than-expected inflation. As of now, the pair trades around the 1.0520 region, navigating a complex landscape shaped by monetary policy and economic data. Fundamentals of the EUR/USD: The Federal Open Market Committee (FOMC) made an unexpected move in its October meeting by reducing its benchmark interest rate by 50 basis points, bringing it to a target range of 4.75% to 5.00%. Despite this sharp cut, investors anticipate the Federal Reserve will adopt a cautious approach with modest rate reductions in the coming year. This outlook has provided broad support for the U.S. Dollar, further weighing on the Euro. The European Central Bank (ECB) is set to play a pivotal role in shaping the Euro’s movements in the latter half of the week. On the U.S. side, markets are eyeing Thursday’s Retail Sales report, which is expected to show a monthly increase of 0.3% for September, compared to the 0.1% growth in August. A better-than-expected Retail Sales figure could bolster the Greenback, adding further pressure on EUR/USD. Daily Time Frame Technical Outlook: Price’s technical outlook highlights the importance of the 200-day Exponential Moving Average (EMA) at 1.0859. A decisive break above this level could shift the momentum, targeting resistance at 1.0880 and 1.0900. However, if the pair fails to breach this threshold, it risks encountering renewed selling pressure, which could extend its bearish trajectory.

The pair’s downward momentum has intensified slightly, with a bearish tilt dominating today’s bias. However, given the current mild momentum, a sharp drop below the 1.0500 mark appears unlikely. The next key support level at 1.0491 is expected to hold steady, while resistance remains at 1.0645 and 1.0700.