EURUSD:
The euro is pulling back after a strong advance to multi-month highs. The 25 bps rate cut in the United States has already been priced in, while subsequent signals of gradual, step-by-step easing have given the dollar some support through a recovery in yields and a modest bid for safe assets. Against this backdrop, EUR/USD is retreating from recent peaks and remains sensitive to comments from U.S. officials and fresh data on demand in the American economy.
The U.S. fundamental picture combines signs of a cooling labor market with resilient consumption. The latest August retail sales report indicated expanding demand, which supports the dollar by reducing the odds of an aggressive easing cycle. For the euro, the key context is slowing—yet still uneven—inflation in the euro area and the ECB’s caution when assessing growth prospects; this curbs the scope for a sustained strengthening of the common currency.
No major pro-euro drivers are expected in the next 24 hours, whereas the U.S. agenda following the Fed decision has prompted some profit-taking in long euro positions. In these conditions, selling on rebounds with moderate risk and a nearby target looks tactically preferable.
Trade recommendation: SELL 1.1815, SL 1.1845, TP 1.1765
Origin: FreshForex
