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  • EUR/USD maintains a 3-day winning steak, rising from YTD lows.
  • Despite ongoing inflation concerns, a strong US employment report released on Friday gave US dollar buyers hope.
  • Traders await ECB’s Lagarde and Eurozone data to find fresh stimulus.

The EUR/USD price accepts bids around 1.1605 ahead of Tuesday’s European session, indicating a three-day gain from YTD lows.

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The underlying currency pair is supported by recent losses by dismal US Treasury bond yields and cautious market optimism. Despite this, the speeches by the ECB and FRS leaders will be important to predicting short-term moves.

Concerns over rate hikes and hesitation about rate cuts add to concerns about reshuffling the Fed to reflect the recent weak market sentiment. Also noteworthy are the recent Japanese policy announcements. Jiji reported Tuesday that Japan’s ruling Liberal Democratic Party (LDP) and coalition partner Komeito will offer 50,000-yen (the US $ 441) coupons to children under 18 as part of the government’s stimulus package.

Despite ongoing inflation concerns, a strong US employment report released on Friday gave US dollar buyers hope. The same was true of the latest Fedspeak and comments made by ECB policymakers. Yet, policymakers are divided over how long reflation fears can last and whether or not rate hikes are required to counter them, which has worried EUR/USD traders lately despite the recent rally.

Stock futures in the US and the eurozone have shown modest losses, while the 10-year US Treasury notes yield has remained unchanged at 1.467%.

To provide traders with additional information before the US PPI in October, in addition to the Fed’s Powell and the ECB’s Lagarde, the ZEW sentiment indicators for the eurozone and Germany will be released for November. Therefore, it cannot be ruled out that the EUR/USD pair could rise further if the eurozone planning data continues to indicate increased pressure on prices.

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EUR/USD price technical analysis: Poised to test 200-SMA

EUR/USD 4-hour price char

The EUR/USD price managed to surge above the 20-period and 50-period SMAs. The pair looks buoyant to test the 200-period SMA around the 1.1625 area. We have an average daily of around 42% so far, which indicates that the pair is quite volatile on the day. Further upside may test support zones at 1.1655 and 1.1690. On the flip side, 1.1550 and 1.1520 (YTD lows) will continue to support the Euro.

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