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EURUSD attempts to build a bullish bottom
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Hello everyone, today XM Forex will bring you "[XM Forex Platform]: EURUSD attempts to build a bullish bottom". Hope this helps you! The original content is as follows:
During the European trading session on Wednesday (January 14), the euro-dollar exchange rate has tried to stop its recent decline for two consecutive trading days, after the exchange rate once fell to a five-week low of 1.1618. After the release of U.S. inflation data, the exchange rate started a rebound attempt and hit the resistance level of 1.1690. As of Wednesday morning, the exchange rate was stable and fluctuating around 1.1645. The market is currently waiting for the release of a new round of major U.S. economic data, including producer price index (PPI) and retail sales data. Both data are scheduled to be released at 21:30 Beijing time.
Affected by unexpected negative events in the United States, the exchange rate of the US dollar against other major currencies was once again under pressure and fell. Federal Reserve Chairman Jerome Powell is facing financial accusations as President Trump pressures the central bank to lower its benchmark interest rate in line with the White House's wishes. However, Federal Reserve officials expressed support for Powell and his policy proposals, temporarily curbing the dollar's decline.
The outlook for U.S. interest rate policy continues to affect the trend of the euro against the U.S. dollar
Foreign exchange market trading data shows that the outlook for U.S. interest rate policy remains a key factor affecting the trend of the euro against the U.S. dollar. The U.S. dollar continued to record net gains this week, pushing the euro-dollar exchange rate to gradually drop to the 1.16 range. Strong U.S. economic data is enough to weaken market expectations for the Federal Reserve to cut interest rates in the short term, and financial markets are increasingly paying attention to whether the Federal Reserve will maintain its current loose policy stance in 2026 or turn to tightening.
Overall, the market's reassessment of the Fed's policy is expected to be the core factor driving the euro-dollar exchange rate in the short term.
From a technical perspective, from the daily chart analysis, the EURUSD is trying to return to 1.1685-1.1750 neutral range. If it can successfully maintain its position in this range, it will pave the way for the exchange rate to test the key psychological resistance level of 1.1800, and also mean that the exchange rate may turn bullish. Currently, the 14-day relative strength index (RSI) is hovering near 42, and has gradually moved closer to the 50 neutral line; the exponential moving average convergence and divergence (MACD) has also begun to turn upward, waiting for new strong positive momentum to appear.
Conversely, triggering a clear downside move would require bearish strength to push the exchange rate below the key psychological support level of 1.1500.
Outlook for the trend of the euro against the U.S. dollar in the www.xmtraders.coming months
In this context, Credit Agricole expects that the euro against the U.S. dollar will fall back to 1.14 in the middle of the year and fall further to 1.10 by the end of 2026. However, ING believes that after the short-term fluctuations, the euro-dollar exchange rate is expected to break through the 1.20 mark.
From the perspective of external factors, the recent economic data released by the United States are mixed, but the overall performance is still strong enough for the market to price in expectations of an interest rate cut by the Federal Reserve in January. At the same time, the evolving geopolitical situation remains a core driver in early 2026.
In this regard, Crédit Agricole pointed out that U.S. President Trump’s decision to order the overthrow of Venezuelan President Maduro’s regime may reduce the negotiation pressure faced by Russian President Putin in the Russia-Ukraine conflict, leading to the continued escalation of the conflict. The bank said: "In the foreseeable future, the Russia-Ukraine conflict will remain the main source of market uncertainty, which will also suppress business confidence and consumer confidence in the euro zone. We also believe that even if Venezuelan crude oil exports expand, the euro zone will be difficult to recover from the continued recovery in energy prices. Crédit Agricole further www.xmtraders.commented: "Judging from our bank's foreign exchange position data, the euro is still one of the most popular long currencies among the G10 currencies." ING held the view that the U.S. dollar was weakening, and the bank said: "The U.S. dollar exchange rate has been 10. % decline is largely due to foreign exchange hedging operations rather than direct market selling of U.S. dollar assets. Based on our forecast, the Federal Reserve will further cut interest rates by 50 basis points, and Germany’s fiscal stimulus policy will promote the accelerated recovery of the Eurozone economy. Therefore, we believe that the U.S. dollar will decline in 2026. It may continue in 2026. Our bank maintains its optimistic judgment and predicts that the euro-dollar exchange rate will reach around 1.22 by the end of 2026. "
Trading recommendations
The euro-dollar exchange rate is currently in a neutral range and needs strong catalysts to push the exchange rate to break through in either direction. It is recommended that investors wait for the exchange rate to drop further before considering placing long orders on dips.
Overall trend: neutral range
Today’s support level for EURUSD: 1.1610—1.1550—1.1480
Today’s resistance level for EURUSD: 1.1690—1.1730—1.1800
EuropeYuan/USD trading signal
Go long EURUSD at the support level of 1.1580, with a target price of 1.1800 and a stop loss of 1.1500.
Short EURUSD at the resistance level of 1.1770, with a target price of 1.1500 and a stop loss of 1.1840.
The above content is all about "[XM Foreign Exchange Platform]: EURUSD attempts to build a bullish bottom". It is carefully www.xmtraders.compiled and edited by the editor of XM Foreign Exchange. I hope it will be helpful to your trading! Thanks for the support!
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