EUR/USD Analysis Summary Today
- Overall Trend: Neutral with a downward bias.
- Today's Support Levels: 1.1560 – 1.1500 – 1.1440.
- Today's Resistance Levels: 1.1680 – 1.1770 -1.1850.
EUR/USD Trading Signals:
- Buy EUR/USD from the 1.1550 support level, with a target of 1.1800 and a stop-loss at 1.1470.
- Sell EUR/USD from the 1.1720 resistance level, with a target of 1.1500 and a stop-loss at 1.1800.
Technical Analysis of EUR/USD Today:
As observed in forex market trading, the latest EUR/USD forecast has been negatively affected by new political turmoil. President Trump's decision to fire Fed Governor Lisa Cook has renewed fears about the Fed's independence. According to trading platforms, despite the euro's decline on Friday after Powell's hawkish speech at Jackson Hole, the US dollar rebounded, keeping the EUR/USD pair at 1.1625, after it had fallen to the 1.1574 support level yesterday.
Forex trading experts warn that a drop below the 1.1580 level for the EUR/USD could push the pair toward 1.1500, although long-term forecasts still point to a return to gains at 1.2000. The US dollar, after its decline on Friday following Fed Chair Powell's speech, has recovered at the start of this week's trading.
In the middle of the week's trading, the US currency fell again in Asia as President Trump launched a new attack on the Federal Reserve, but it rebounded from its lows, with the EUR/USD trading around 1.1635. According to technical forecasts, the euro is vulnerable to more losses in the near term. A break of the support level at 1.1580/90 could lead to a continued decline to the 1.1500/1520 range, especially since investors may have increased their long EUR/USD positions after Powell's cautious remarks on Friday.
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Will the euro/dollar rise in the coming days?
According to UoB's currency analysis team, which was less pessimistic about the single European currency, the sharp decline seems to have overextended, and it's unlikely that the euro will weaken much further. They expect the euro to trade in a range of 1.1600/1.1690 today. In contrast, ING Bank remains pessimistic about the US dollar in the medium term, with an expectation for the EUR/USD to rise to 1.2000.
The Future of Fed Policy Will Determine the Fate of Currencies
Depending on the market drivers, the key issue will be whether there will be lasting damage to the US dollar amid concerns surrounding the independence of the Federal Reserve. US President Trump announced overnight that he had removed Fed Governor Cook from her position as governor of the central bank. According to Trump, there was "sufficient reason" to believe Cook had made false statements regarding mortgage agreements, and he cited constitutional powers that he said allowed him to fire her.
Obviously, the allegations relate to key real estate residency permits.
For her part, Cook fiercely defended herself, saying, "President Trump claimed he fired me 'for good reason,' when there was no legal reason, and he had no authority to do so." She added, "I will not resign. I will continue to perform my duties to support the US economy, as I have done since 2022." According to currency trading experts, Trump's decision to fire Lisa Cook will cast a shadow over the independence of the Federal Reserve and could weigh on the dollar and US Treasuries. However, don't expect significant market movements, as Trump's action is somewhat unprecedented and could be challenged in US courts.
Meanwhile, the euro has also been affected by the French government's decision to call for a confidence vote on September 8th.
Trading Tips:
Traders are advised to wait for further EUR/USD losses to identify the most suitable and strongest levels to buy the pair, but without taking on risk.
Today, EUR/USD trading will be affected by US economic releases, led by the US GDP growth reading and weekly jobless claims, both at 3:30 PM Cairo time. Then, the anticipated US home sales data will be announced at 5:00 PM Cairo time. Technically, the movements of the 14-day RSI and the MACD confirm a neutral stance with a downward bias.
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