EUR/USD Rises as Dollar Weakens, Risk Sentiment Improves.
EUR/USD gains as risk appetite improves and US Dollar weakens
FUNDAMENTAL OVERVIEW:
The EUR/USD pair is seeing moderate gains during a quiet Friday session, buoyed by improved risk appetite in Asia following upbeat U.S. consumption and employment data. Adding to the positive tone were dovish remarks from Fed Governor Christopher Waller, who reiterated support for interest rate cuts.
The Euro climbed to 1.1635 in the European morning session, rebounding from Thursday’s three-week low of 1.1555, as the U.S. Dollar weakened alongside falling Treasury yields. Despite the recovery, EUR/USD is still on track for a 0.60% weekly loss—its second consecutive negative weekly close.
Strong earnings from major U.S. companies, including Netflix, TSMC, PepsiCo, and United Airlines, helped boost market sentiment, prompting a rally in equities and diminishing demand for the safe-haven Dollar.
This optimistic tone carried through into Friday’s Asian and European trading, further reinforced by Waller’s comments warning of rising risks to the labor market and overall economic growth, supporting the case for a rate cut after the Fed’s July meeting.
On the macro front, U.S. data released Thursday showed retail sales rebounded strongly in June, while jobless claims unexpectedly dropped to a three-month low. These, combined with earlier CPI strength, provide grounds for the Fed to hold steady on policy until the full impact of tariffs becomes clearer.
EUR/USD TECHNICAL ANALYSIS DAILY CHART:
Technical Overview:
EUR/USD is trading within an up channel.
EUR/USD is moving above all the Moving Averages (SMA).
The Relative Strength Index (RSI) is in the Buying Zone, while the Stochastic oscillator suggests a Positive trend.
Immediate Resistance level: 1.1662
Immediate support level: 1.1542
HOW TO TRADE EUR/USD
The EUR/USD initially surged but was ultimately rejected at higher levels, resulting in a downward correction. It’s presently moving towards a significant support area. A successful test of this area, with the price remaining above it, could pave the way for further gains for the EUR/USD.
TRADE SUGGESTION- LIMIT BUY – 1.1545, TAKE PROFIT AT- 1.1700, SL AT- 1.1469.