EUR/USD Consolidates Below 1.0900 Ahead of US Retail Sales Data

The EUR/USD pair remains range-bound below 1.0900 in Monday’s European session, as traders await US Retail Sales data later today. Meanwhile, the Euro stays defensive ahead of Tuesday’s German fiscal reform vote and the anticipated US-Russia talks.

Key Market Highlights:

• ECB’s de Guindos warns that a trade war would be detrimental to the global economy, emphasizing that “everyone loses in that situation.”
• US Dollar steadies, with traders cautious ahead of key economic events.
• German CDU/CSU, SPD, and Green Party set to vote on fiscal spending reforms on Tuesday.

---

Technical Analysis: Indecision Persists Below 1.0900

The EUR/USD pair shows indecisiveness, with the Relative Strength Index (RSI) hovering slightly above 50 on the 4-hour chart. The pair also fluctuates near the 20-period Simple Moving Average (SMA), reflecting market uncertainty.

Key Support & Resistance Levels:

• Support:
  • 1.0850-1.0860: Confluence of 50-period SMA & 200-week SMA
  • 1.0800: Psychological and static support
  • 1.0730: 200-day SMA
• Resistance:
  • 1.0900: Key round level
  • 1.0940: Static resistance
  • 1.1000: Psychological barrier

---

Market Outlook: Cautious Trading Ahead of Major Events

After snapping a two-day losing streak, EUR/USD closed last week marginally higher. However, the pair remains in consolidation mode below 1.0900 as investors stay on the sidelines ahead of key economic developments.

• Friday’s positive risk sentiment pressured the US Dollar (USD), allowing EUR/USD to hold its ground.
• US stock futures trading in negative territory early Monday has prevented EUR/USD from gaining further momentum.
• US Retail Sales data (February) is expected to show a 0.7% increase, following a 0.9% decline in January. A disappointing reading could weaken the USD, though traders may hold off on significant moves ahead of Wednesday’s Federal Reserve meeting.

---

Upcoming Events to Watch

• Monday: US Retail Sales Data (February)
• Tuesday: Germany’s fiscal reform vote
• Wednesday: Federal Reserve policy decision
• US-Russia diplomatic talks—potential impact on global risk sentiment.

---

Bottom Line

The EUR/USD remains in a wait-and-see mode, trading within a narrow range as US economic data and European fiscal policies take center stage this week. While key technical levels hold, upcoming events, especially the Fed’s monetary policy decision, could set the tone for the pair’s next major move.

Would you like a customized trading outlook or deeper insights into potential market catalysts? Let me know! 🚀📊

Stay Updated with Daily Forex Pakistan