In the Tokyo market, the euro faced resistance and moved downward, dropping to 1.0783. However, it reversed in the European market. Statements from Unsch, the head of Belgium’s central bank, that there was ‘no immediate need to further accelerate monetary easing,’ along with a decline in U.S. long-term interest rates, helped the euro rebound to 1.0827. Later, weak demand in the U.S. 2-year bond auction led to a rise in U.S. long-term rates, which kept the euro from further gains.
After last week’s dip, the euro has again dropped to around 1.0762, close to its low on August 2, indicating a return to previous levels. Although the rate of interest rate cuts in Europe might surpass the Federal Reserve’s pace due to the U.S. economy’s strength compared to Europe’s, selling pressure due to policy differences appears to be easing for now.
With the release of U.S. October employment data at the end of the week, the euro is expected to remain relatively stable.
EUR/USD Expected Range: 1.0850 – 1.0780
Note: The above does not guarantee profit. Please make trading decisions at your own risk.