The EUR/USD currency pair remains under pressure but stays above the 1.1400 level during Wednesday’s European trading session. The US Dollar has strengthened, driven by easing trade tensions between the United States and China.
Market participants are cautious and mostly waiting on the upcoming US Consumer Price Index (CPI) inflation data, which is expected to have a significant impact.
Technical Outlook
Technically, the daily chart suggests the EUR/USD could continue to rise as buyers maintain control.
Key technical indicators show a neutral to mildly bullish trend. The 20-day Simple Moving Average (SMA) is trending upward near 1.1330, supporting the pair, while the longer-term SMAs (100 and 200 days) also point higher, consistent with an overall bullish trend.
However, the pair is fluctuating around the 20 SMA without a clear breakout yet. Support levels are identified at 1.1385, 1.1340, and 1.1310, while resistance is expected near 1.1450, 1.1490, and 1.1525.
Fundamental Factors
The US Dollar’s recent strength follows positive developments in US-China trade talks. Representatives from both countries met in London on Monday and agreed to continue discussions, easing market concerns about tariffs. This optimism supported the USD earlier in the day, although gains softened as European stocks showed mixed performance.
In the Eurozone, the Sentix Investor Confidence index improved in June, rising to 0.2 from -8.1 in May, indicating slightly better market sentiment. However, the main focus remains on the US CPI report due Wednesday afternoon, which will reveal inflation trends and influence Federal Reserve policy decisions.
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