|

EUR/USD - Will ECB minutes re-establish the uptrend, Descending triangle noted?

EUR/USD found takers at the 20-day low of 1.1681 and ran into rising trend line hurdle after the Fed minutes released in the NY session showed growing concerns among policymakers about weak inflation.

Data heavy day, focus on the ECB minutes

The currency pair closed at 1.1766 and extended gains 1.1790 in the Asian session. The key data due for release are - Eurozone July final CPI at 9:00 GMT, Eurozone trade balance at 10:00 GMT, ECB minutes at 11:30 GMT. Across the pond, weekly jobless claims will be released at 12:30 GMT, followed by industrial production at 13:15 GMT and Fed’s Kaplan speech at 16:30 GMT. Sounds like a data heavy data, although the main event for the day is the ECB minutes release. 

ECB minutes - watch out for comments on the exchange rate

The minutes due today are expected to shed more light on the discussion that took place within the governing council on inflation outlook, potential QE taper and the impact of the recent Euro appreciation on growth and inflation. 

On the inflation front, the minutes are likely to reiterate Draghi’s view that there are no convincing signs of a pickup in price pressure and that inflation currently stands well below the central bank’s target. 

Coming to exchange rate, the minutes are more likely to say that a strong Euro could cap inflation, but is also a sign of growing confidence in the Eurozone economy. Finally, more clues regarding a potential QE taper in September/October could move the EUR pairs as well. 

The bulls may regain control of the EUR/USD if the minutes hint at the September QE taper and sound upbeat on inflation and economy. On the other hand, bears may come-in strong if the minutes highlight concerns regarding weak inflation and EUR strength. Moreover, it would mean the ECB could delay the QE taper. 

EUR/USD Technical Levels

The daily chart shows a descending triangle formation, which are typically continuation patterns. However, at times the descending triangles have worked as bearish reversal patterns as well. 

A break above 1.1812 [triangle hurdle] would open up upside towards 1.1848 [Aug 11 high], above which a major hurdle is seen at 1.1910 [recent high]. On the downside, breach of support at 1.1765 [Asian session low] could yield 1.1687 [triangle support]. An end of the day close below the same would signal trend reversal and open doors for 1.15 levels. 

Author

Omkar Godbole

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

More from Omkar Godbole
Share:

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

By subscribing you agree to our Terms and conditions.

Editor's Picks

EUR/USD flatlines below 1.1800 amid trading lull, awaits Fed Minutes

EUR/USD trades around a flatline below 1.1800 in European trading on Tuesday. The pair lacks any trading impetus as the US Dollar moves little amid market caution ahead of the Fed's December Meeting Minutes release, which could offer insights into the Federal Reserve’s 2026 outlook.

GBP/USD retakes 1.3500 despite the year-end grind

GBP/USD finds fresh demand and retakes 1.3500 on Tuesday as markets grind through the last trading week of the year. Despite the latest uptick, the pair is unlikely to see further progress due to the year-end holiday volumes.

Gold holds the bounce on Fed rate cut bets, safe-haven flows

Gold holds the rebound near $4,350 in the European trading hours on Tuesday. The precious metal recovers some lost ground after falling 4.5% in the previous session, which was Gold's largest single-day loss since October. Increased margin requirements on gold and silver futures by the Chicago Mercantile Exchange Group, one of the world’s largest trading floors for commodities, prompted widespread profit-taking and portfolio rebalancing.

Tron steadies as Justin Sun invests $18 million in Tron Inc.

Tron (TRX) trades above $0.2800 at press time on Monday, hovering below the 50-day Exponential Moving Average (EMA) at $0.2859.

Economic outlook 2026-2027 in advanced countries: Solidity test

After a year marked by global economic resilience and ending on a note of optimism, 2026 looks promising and could be a year of solid economic performance. In our baseline scenario, we expect most of the supportive factors at work in 2025 to continue to play a role in 2026.

Crypto market outlook for 2026

Year 2025 was volatile, as crypto often is.  Among positive catalysts were favourable regulatory changes in the U.S., rise of Digital Asset Treasuries (DAT), adoption of AI and tokenization of Real-World-Assets (RWA).