EURUSD Settles into Range
Following heavy selling over Q4 as the US Dollar ballooned, EURUSD has settled into a roughly 350 pip range over 2025 to date. Fading bullish momentum in USD has seen the market stalled into the 1.0176 level support for now. Bullish USD fireworks around Trump’s tariff announcement have been limited after the initial reaction we saw a fortnight ago. Downside EUR action has been limited for now too, though this could change if Trump increases the scope of tariffs on the bloc.
Lagarde Speaks on Recovery & Risks
Speaking yesterday, ECB’s Lagarde noted that the conditions for a recovery in the eurozone are still in place, though noted that there are both upside and downside risks in the outlook. Notably, the ECB head didn’t comment on risks posed by Trump’s tariff agenda, only to say that the inflation outlook is more uncertain. Looking ahead, Lagarde noted that the frequency of shocks is likely to remain elevated, suggesting the risk for more volatility, but cited the bank’s view that inflation is still projected to return to target this year. Against the backdrop of heightened uncertainty, the market is currently expecting the ECB to ease further in coming months, particularly if trade tensions start to take a toll.
Technical Views
EURUSD
For now, the market remains within a sideways correction against the prior bear-term. While 1.0515 holds as resistance, focus is on an eventual break lower with .9993 the next target for bears. If bulls can get back above 1.0515, however, this will alleviate near-term bearish risks, putting focus on a recovery towards 1.0724.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.