The foreign exchange market experienced restrained activity on Monday, as the GBP/USD and EUR/USD pairs traded within narrow ranges. In the second half of the day, the GBP/USD fluctuated tightly near the 1.2600 mark, while the EUR/USD remained under modest bearish pressure, trading below 1.0500. This subdued trading environment coincided with a cautious market mood, which provided support to the US Dollar.
On Monday, financial markets in the United States observed Presidents' Day, resulting in a long weekend. Consequently, US markets were closed, leading to reduced trading volumes worldwide. The absence of active trading participants contributed to the subdued market action and the limited upside potential for currency pairs such as GBP/USD and EUR/USD.
The cautious sentiment among market participants played a significant role in shaping Monday's trading dynamics. As investors adopted a wait-and-see approach, the US Dollar found support amid uncertainty. The restrained market mood capped any significant upward movement in currency pairs, particularly affecting those involving the US Dollar.
Overall, trading volumes remained thin, reflecting the impact of the US holiday on global financial markets. The closure of US markets led to limited liquidity, which further contributed to the restrained trading environment observed throughout the day.
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