Category: Forex News, News

EUR/USD Outlook: Euro Finds Footing After Trump Trade Decline

By Published On: November 7, 20242.4 min readViews: 290 Comments on EUR/USD Outlook: Euro Finds Footing After Trump Trade Decline

  • The dollar had a strong bullish day on Wednesday after Trump won the election.
  • Market participants prepare for a rate cut during the FOMC policy meeting.
  • The US reported an addition of 12.000 jobs in October.

The EUR/USD outlook shows a rebound in the euro after reaching new lows due to Wednesday’s Trump trade. Market participants paused the recent move ahead of the FOMC policy meeting, where the Fed will likely lower borrowing costs. 

Are you interested to learn more about forex options trading? Check our detailed guide-

banner image

The dollar had a strong bullish day on Wednesday after Trump won the election to become the US president again. The Trump trade resumed enthusiastically as markets looked forward to tax cuts and tariffs on imported goods. At the same time, a Trump presidency will likely complicate the Fed’s rate-cutting cycle. After the results, traders lowered the likelihood of a rate cut in December from 77%  to 67%. 

Meanwhile, market participants are preparing for a rate cut during the FOMC policy meeting later today. Although the US central bank will likely cut rates, it will be by a smaller size than traders had expected a few weeks ago. The Fed started its rate-cutting cycle with a super-sized rate cut, which increased expectations of another such move in November. However, economic resilience has changed this outlook. 

Nevertheless, the latest jobs report revealed unexpected weakness in the labor market that might scare policymakers. Economists had expected slower job growth due to recent hurricanes. However, an addition of 12.000 jobs was far below estimates. A dovish tone during the meeting will increase the likelihood of a rate cut in December. On the other hand, if policymakers demonstrate caution, rate-cut bets will fall, further boosting the greenback. 

EUR/USD key events today

  • Unemployment Claims
  • Federal Funds Rate
  • FOMC Statement
  • FOMC Press Conference

EUR/USD technical outlook: Bears take charge after evening star pattern 

EUR/USD Outlook: Euro Finds Footing After Trump Trade Decline
EUR/USD technical outlook

On the technical side, the EUR/USD price has paused its decline near the 1.0700 key psychological level. It trades far below the 30-SMA, showing bears are in the lead. At the same time, the RSI trades near the oversold region, suggesting strong bearish momentum. 

Are you interested to learn about forex robots? Check our detailed guide-  

Initially, bulls had reversed the trend by breaching the 30-SMA and making higher highs and lows. However, they failed to sustain a move beyond the 1.0900 resistance. Here, bears took charge with the price making a strong evening star pattern that broke below the SMA. Given the solid bearish bias, the downtrend might soon resume with a break below 1.0700.

Looking to trade forex now? Invest at eToro!

67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Source link

Written by : Editorial team of BIPNs

Main team of content of bipns.com. Any type of content should be approved by us.

Share this article:

Leave A Comment