- UUR/USD is struggling with Psychological Resistance 1.0500, as expectations for the US dollar are unconfirmed.
- Panetta from the European Central Bank ECB is concerned about the increasing risk of low inflation than the 2%target.
- US President Donald Trump announced on Friday that he is planning to impose customs definitions on imported cars.
The Euro/USD/USD pair is struggling to extend his upward movement over the 1.0500 psychological resistance in the European session on Monday. The main pair is trading accidentally as investors make the potential impact of US President Donald Trump’s definitions on the euro area.
President Trump announced on Friday that he is planning to impose customs tariffs on imported cars on April 2. Also, mutual definitions are planned in the same period.
Participants in the market expect that the main impact of fees on cars will be on Germany, Japan and South Korea, and they are the leading countries in exporting cars to the United States. According to OEC data, Germany has exported $ 24.3 billion to the United States in 2023.
During the weekend, the European Central Bank of ECB and the governor of the Italian Bank of Italy, Fabio Panetta, said in a speech at the annual financial conference Assiom-Forex in Italy that the net impact of definitions on inflation in the euro area would be “limited, if not a little negative.”
Panetta opinions are based on the assumption that the potential weakness in the euro (EUR) due to the highest American definitions and any revenge on Europe will be compensated for a global economic slowdown and China dumping the goods affected by the definitions in European markets.
Fabio Panetta directed a pessimistic view of the monetary policy, stating that the main danger to the old continent is “a decrease in inflation than the 2% -term goal in the medium term.”
Daily market engines: EUR/USD is struggling with the US dollar temporarily increasing
- The Euro/US/USD pair faces pressure to extend its strength last week, as the US dollar (USD) is stable with caution near its lowest new levels in two months, which he recorded on Friday. The US dollar index (DXY), which tracks the value of the US currency for six main currencies, is trading near 106.80.
- The US dollar index witnessed sharp sales on Friday after the issuance of weak US retail sales data for January. Retail sales data, a major measure of consumer spending, decreased at a faster rate of 0.9% per month. Economists expected that the scale of consumer spending will shrink by 0.1%.
- The expectations of the US dollar were already under decline, as the concerns of the immediate mutual definitions of President Trump faded. On Thursday, Donald Trump asked the Ministry of Trade and Treasury to prepare a mutual definition plan. However, investors expected Trump to reveal the detailed mutual definition plan immediately.
- These expectations were based on Trump’s tweet on Truth Social, “Three wonderful weeks, perhaps the best ever, but today is the big: mutual definitions !!! Make America great again !!!”, which came in early trading hours in North America a day Thursday.
- This week, the US dollar will be affected by letters of a group of Federal Reserve officials (Fed) who will direct monetary policy expectations. On the economic level, investors will focus on the data of the International Procurement Managers Index for the initial S&P for the month of February, which will be issued on Friday.
Technical Analysis: EUR/USD is facing resistance near 1.0500
EUR/USD pair is struggling to penetrate the main resistance at 1.0500 in European trading hours on Monday. Expectations of the main husband turned into an upward, as the EMA moving average settles for 50 days, which stands at about 1.0430.
The RSI index applies 14 days to approximately 60.00. A bullish momentum will be activated if the RSI index can with 14 days settings to stay above this level.
Looking down, the lowest February 10 levels at 1.0285 will act as a major support zone for the husband. On the contrary, the highest levels of December 6 at 1.0630 will be the main barrier of euro bulls.
2025-02-17 10:41:18