- The EUR/USD outlook reflects range-bound momentum amid US government shutdown optimism.
- Luis de Guindos remains optimistic, with current interest rates, and suggests no changes if the currency inflation trends persist.
- Traders look ahead to the EUR Sentix Investor Confidence and remarks from FOMC officials for fresh impetus.
The EUR/USD outlook shows a mild bullish bias as the pair trades near 1.1570 on Monday. The US dollar remains under mild pressure as the Senate advances a funding bill to end the prolonged US government shutdown, with a 60-40 vote split. Even though the bill requires approval from the White House Representatives, and President Trump’s signature, the optimism surrounding it has improved risk appetite across global markets.
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Meanwhile, the Dollar Index (DXY) holds near 99.64, slipping 0.1% after investors stepped back amid hopes of imminent reopening. However, the rising US Treasury yields and reduced expectations of a December Fed cut capped broader losses for the greenback. Markets price in a 63% probability of a December Fed cut, which could go down further on account of potential economic stabilization.
In Europe, the euro witnessed limited momentum and remained unaffected by ECB Vice President Luis de Guindos’s remarks. He emphasized that the current interest rates are appropriate, lest inflation trends or projections change. He also noted that inflation remains near the 2% target, with improving services and wage growth and decreasing uncertainty. The euro didn’t react as traders shifted focus towards the US fiscal headlines and global risk sentiment.
EUR/USD Daily Key Events
The major events in the day include:
- Sentix Investor Confidence
- FOMC Member Musalem Speaks
- FOMC Member Daly Speaks
On Monday, traders look forward to the EUR Sentix Investor Confidence for insights into the investor sentiments and speeches from FOMC members Musalem and Daly for more impetus.
EUR/USD Technical Outlook: Bulls Eye Resistance at 1.1640
The EUR/USD 4-hour chart shows a bullish bias as the pair trades near 1.1570, after rebounding from recent lows under 1.1500. The price stays above the 20-period and 50-period MA, signaling short-term buying momentum. The 200-period MA, near 1.1600, acts as a strong resistance zone.
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The RSI stands near 60, pointing towards an improving bullish bias and room for further gains. The recent higher lows suggest buying pressure. But the pair requires a break above 1.1640 for a continued bullish bias. In case it fails to breach the resistance, fresh selling pressure could emerge, driving the pair back to its previous lows.
Support Levels
Resistance Levels
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