The trade in the EUR/USD currency pair is just around 1.1840. This points towards a bid bias, despite having suffered some losses against the US Dollar. Despite a short-lived fixin’ on Wednesday, the pair fought back with conviction. Worse yet, it showed amazing resiliency even with the unpredictable market forces.
EUR/USD is currently trading in the 1.18305-1.1840. Despite dropping down into the sub-1.1800 area, the pair hardly hesitated to pick itself back up, shrugging off early losses. This quick rebound indicates that buyers are hungry. Speculators continue to weigh various macroeconomic data and central bank actions that affect the EUR/USD currency cross.
All market participants should be intently watching the fiscal implications from the Federal Reserve’s cut to interest rates. Chief Powell’s hawkish pose adds uncertainty to the EUR/USD equation. Investors are when this will weigh on US yields and the overall strength of the Greenback. US yields have dropped over all time periods. This plunge has only added to the already low dollar’s modest losses further, while keeping the euro on bid bias and up trend continuing.
Second, gold’s broad continuation bullish trend is shaping up investor sentiment toward the US Dollar, by extension putting downward pressure on the EUR/USD exchange rate. After commodities and currencies, traders are looking at equities. They are keenly watching for any shifts in the European or US economic environment.
The continuous evaluation of GBP/USD rates plays a big role in affecting market sentiment. Its influence on EUR/USD is more indirect. The Bank of England has chosen to hold its policy rate steady. This change has introduced remarkable stability to GBP/USD which traders are studiously calibrating to gauge how this should feed through to the euro.
While Bitcoin’s price forecast and its connection to the Federal Open Market Committee’s dovish stance appear unrelated to EUR/USD, they remain part of a broader market context that traders keep in mind. The interaction between a variety of financial assets still works to influence investor expectations as investors make their way through this uncertain landscape.