EUR – The euro is trading sideways, with technicals still favorable

The dollar rose on Monday as traders reduced bets on a September rate cut ahead of a speech by Federal Reserve Chairman Jerome Powell on Friday. Powell will speak at the Fed's annual economic policy symposium in Jackson Hole, Wyoming, this week. Powell has previously said he is reluctant to cut rates because he expects Trump's tariffs to lead to higher inflation this summer. Fed funds futures traders are currently pricing in an 83% probability of a September rate cut, having briefly fully priced that in last week.

Trump met with Ukrainian President Volodymyr Zelensky on Monday, followed by talks with leaders of the United Kingdom, Germany, France, Italy, Finland, the European Union, and NATO. Trump said the United States would "help" Europe provide security guarantees for Ukraine as part of a deal to end the war there, and expressed hope that Monday's summit would ultimately lead to a trilateral meeting with Russian President Vladimir Putin, adding that he believed Putin wanted to end the war. Trump's meeting with Zelensky failed to have a significant market impact.

Regarding the Euro/USD trend, as seen on the technical chart, the 10-day moving average is crossing above the 25-day moving average. Meanwhile, the MACD indicator has just broken above its signal line, suggesting further stabilization of the Euro/USD pair. Nearest resistance is seen at 1.1730, followed by 1.18 and even 1.1829 on July 1st. A breakout above this level could further solidify the Euro's upward trend. Extended targets include 1.20 and 1.2150. Nearest support is expected at the 25-day moving average of 1.1630 and 1.1570, with the next level at 1.15.

Forecast range:
Resistance: 1.1730 - 1.1800/1.1830 - 1.2000* - 1.2150
Support: 1.1630 - 1.1570 - 1.1500

Focus:
Tuesday
Eurozone June Current Account Balance (4:00 PM)

Wednesday
Germany July PPI (3:00 PM)
Eurozone July HICP (5:00 PM)

Thursday
Eurozone August Preliminary PMI
Eurozone August Preliminary Consumer Confidence Index (10:00 PM)

Friday
Germany Q2 GDP Revised (2:00 PM)

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