EUR/USD remains below 1.1800 in early European trading, reflecting a subdued technical outlook amid limited buying interest. The pair exhibited some volatility during the previous session but ultimately closed unchanged after experiencing an initial bullish gap. The prevailing downward momentum continues into Tuesday’s session as the currency pair edges lower, underscoring the muted investor appetite for the EURO against the US dollar.
In the prior trading session, US dollar strength was influenced by a safe-haven flow triggered by Wall Street’s decline and renewed concerns over tariff uncertainties. Following the US Supreme Court’s ruling against existing tariffs, the US administration announced a broad 15% tariff increase, prompting the European Parliament to delay a scheduled vote on the EU-US trade agreement. This development heightened global trade tensions, exerting further pressure on risk assets and elevating the US dollar’s appeal as a safe-haven currency.
The European economic calendar on Tuesday lacks high-impact data releases, though attention will be on later in the day when the US Conference Board publishes consumer confidence figures for February, and employment data from ADP is released. Additionally, multiple Federal Reserve officials are scheduled to speak, with markets paying close attention to their comments on inflation and policy outlook. Any signals indicating a cautious stance or an extension of the current pause in rate hikes could reinforce US dollar resilience, thereby maintaining bearish pressures on EUR/USD . Market pricing currently assigns a negligible chance of a rate cut in March, with around an 80% probability of rates remaining steady through May.
Technically, the EUR/USD remains under pressure, with short-term moving averages trending downward. The pair trades beneath key resistance levels, including the 20-day simple moving average near 1.1783. Momentum measures indicate subdued buying activity, while a declining trendline from recent highs continues to cap any recovery attempts. Support levels are identified around the 61.8% Fibonacci retracement at 1.1757, with further downside potential toward the 78.6% level at 1.1684 should bearish momentum persist.
Positive economic data and rising inflation can bolster the EURO , especially if they prompt the ECB to consider tightening monetary policy by raising interest rates. Conversely, economic weakness or lower-than-expected inflation may weigh on the EURO , reinforcing downward price movements.
