EUR/USD is holding its ground, trading in a very tight range around 1.1700 in the European trading session on Monday. Either way, traders are keeping a very defensive posture. They would rather remain on the sidelines than make new wagers against the currency pair. Geopolitical factors are behind this restraint. Perhaps most excitingly, the third Trump-Zelensky meeting, in which we are to discuss an ongoing Ukraine peace deal.
Today, market analysts are ringing the alarm bell on the very same concern. The failure to produce an agreement between the United States and Russia this past weekend is adding to the uncertainty EUR/USD trading conditions. The lack of clarity in these negotiations has traders on edge, adding to the narrow trading range seen.
As the Trump-Zelensky meeting approaches next week, traders are going to be listening closely for signs of progress. The political playing field is getting trickier. Increasing US trade tensions will continue to weigh on the EUR/USD exchange rate and global economic state.
Faced with a US-China trade war, many companies are anxious about potential shifts in their long-term, stable trade relations. Such turbulence may result in greater EUR/USD exchange rate volatility. A resilient US economy is likely to provoke additional trade conflicts, as rising customs revenues indicate pressure for more assertive trade policies.
“Five reasons why Trump’s trade war is likely to escalate,” according to FXStreet. Market analysts are particularly looking at how these economic indicators are playing out on broader market movements. They are concerned that continued trade frictions can lead to abrupt and volatile currency valuation changes.
Competitive spreads and fast execution for EUR/USD trading are now typically provided by online brokers. Their advanced platforms provide the retail trader with the right tools to easily cut through this very volatile environment. Despite the challenges posed by external factors, these tools ensure that market participants can respond promptly to fluctuations in the currency pair.