The Euro Makes a Slight Recovery After a Downturn
Following a slight recovery today, the euro experienced a downturn on Thursday due to lower inflation figures in the European Union and a stronger dollar. Market participants are eagerly anticipating Federal Reserve Chair Jerome Powell’s speeches, which are expected to provide insights into the central bank’s future monetary policy direction.
The single currency had been under pressure due to soft EU inflation statistics that prompted a near 0.8% drop on Thursday. This downward movement came after the euro failed twice to breach the key psychological level of 1.10, finding some support at a Fibonacci retracement mark of 1.0882. Despite the modest rebound, the euro remains under near-term pressure while trading below the crucial threshold of the daily chart’s 10-day moving average (10DMA) at 1.0926.
Traders are keeping a close eye on further pivotal levels, particularly at 1.0818/00, which includes the weekly cloud top and a Fibonacci retracement zone. A decisive break below the Fibonacci resistance at 1.0559 would confirm a bear-trap scenario on the weekly timeframe, which could increase the downside risks for the euro.
The euro’s future movements will continue to be influenced by a variety of factors, including economic data releases, central bank announcements, and geopolitical developments. Traders and investors need to remain vigilant and adapt their strategies in response to these dynamic market conditions.
