EUR/USD Price Forecast: Trades cautiously near two-week low around 1.1570

EUR/USD struggles to gain ground near the two-week low around 1.1570.
Easing Fed dovish bets and improving US-China trade relations have supported the US Dollar.
The ECB kept interest rates steady on Thursday and offered no major cues on the monetary policy outlook.

Sagar Dua FXStreet

The EUR/USD pair trades with caution near the two-week low around 1.1570 during the early European trading session on Friday. The major currency pair struggles to gain ground as the US Dollar (USD) trades firmly due to multiple tailwinds: easing Federal Reserve (Fed) dovish bets and improving United States (US)-China trade relations.

At the time of writing, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, holds onto gains near an almost three-month high around 99.70 posted on Thursday.

US Dollar Price This week

The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the strongest against the British Pound.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		0.58%	1.31%	0.62%	-0.13%	-0.02%	0.96%	0.66%
EUR	-0.58%		0.73%	0.09%	-0.70%	-0.53%	0.38%	0.08%
GBP	-1.31%	-0.73%		-0.73%	-1.43%	-1.24%	-0.35%	-0.68%
JPY	-0.62%	-0.09%	0.73%		-0.83%	-0.71%	0.22%	-0.05%
CAD	0.13%	0.70%	1.43%	0.83%		0.05%	1.09%	0.76%
AUD	0.02%	0.53%	1.24%	0.71%	-0.05%		0.90%	0.61%
NZD	-0.96%	-0.38%	0.35%	-0.22%	-1.09%	-0.90%		-0.33%
CHF	-0.66%	-0.08%	0.68%	0.05%	-0.76%	-0.61%	0.33%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

Fed dovish speculation has cooled down as Chairman Jerome Powell stated in the press conference after reducing interest rates by 25 basis points (bps) to 3.75%-4.00% on Wednesday further monetary easing in December is “far from a foregone conclusion”.

Meanwhile, the Euro (EUR) remains broadly firm after the monetary policy announcement by the European Central Bank (ECB) on Thursday. The ECB held its Deposit Facility rate steady at 2% as inflationary pressures remain will confined to near the 2% target. The central bank didn’t offer any major clues on the interest rate outlook.

In Friday’s session, investors will focus on the preliminary Eurozone Harmonized Index of Consumer Prices (HICP) data for October, which will be published at 10:00 GMT.

EUR/USD trades inside Thursday’s trading range around 1.1570 on Friday. The near-term trend of the pair is bearish as it stays below the 20-day Exponential Moving Average (EMA), which trades near 1.1630.

The 14-day Relative Strength Index (RSI) wobbles around 40.00. A fresh bearish momentum would emerge if the RSI breaks below that level.

A fresh downside move by the pair below the October 30 low of 1.1547 would expose it to the August 5 low of 1.1528, followed by the August 1 low of 1.1392.

On the flip side, a fresh upside move in the pair would become inevitable to near the July’s high at 1.1830 and the round-level resistance of 1.1900 if it breaks above the October 17 high of 1.1728.

EUR/USD daily chart

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