EUR/USD Struggles Near 1.1550 as Inflation Cools, Fed Speeches Loom
The EUR/USD pair remains under pressure around 1.1550, extending losses after a wave of mixed Eurozone data signaled weaker economic...
Quick overview
- The EUR/USD pair is under pressure around 1.1550 due to mixed Eurozone economic data indicating weaker momentum.
- Germany's retail sales rose only 0.2% in October, while inflation readings showed a slowdown in the Eurozone's CPI.
- The European Central Bank is expected to maintain a cautious stance as inflation cools and growth stagnates.
- Traders anticipate further direction from upcoming Federal Reserve speakers, with bearish sentiment prevailing for the euro.
The EUR/USD pair remains under pressure around 1.1550, extending losses after a wave of mixed Eurozone data signaled weaker economic momentum across the bloc. Germany’s retail sales rose just 0.2% in October, missing expectations, while import prices improved modestly by 0.2% after months of decline.
Inflation readings offered little support. The Eurozone’s flash CPI slowed to 2.1% year-on-year, while the core CPI held steady at 2.4%, in line with forecasts. France’s preliminary CPI ticked up by 0.1%, and Italy’s fell –0.3%, showing that price pressures are easing unevenly across member states.
The muted data reinforced the view that the European Central Bank will maintain a cautious stance, balancing cooling inflation with stagnating growth. With the ECB holding its main refinancing rate at 2.15%, traders now look to the Federal Reserve speakers — including Logan, Bostic, and Hammack — for fresh cues on the dollar’s short-term direction.
EUR/USD Technical Setup: Euro Eyes 1.1500 Support
On the 4-hour chart, EUR/USD continues to respect its descending trendline from September highs, confirming the broader downtrend. The pair trades below the 20-period EMA, which has turned sharply lower near 1.1595, aligning with bearish momentum.
Recent sessions show a bearish engulfing candle followed by small-bodied Doji candles — a sign of market hesitation rather than reversal. The RSI hovers near 36, just above oversold territory, suggesting sellers remain in control but may face short-term exhaustion.
If the euro holds below 1.1560, downside targets emerge at 1.1500 and 1.1450, key psychological and structural support levels. A sustained break below 1.1500 could open the door toward 1.1390. Conversely, a rebound above 1.1620 would be the first sign of a momentum shift, with resistance seen at 1.1665 and 1.1728.
EUR/USD Outlook: Bearish Bias Until Data Surprises
With Eurozone inflation cooling and the dollar supported by firm U.S. data, the path of least resistance for EUR/USD remains lower. Unless the upcoming FOMC remarks or U.S. PMI readings disappoint, the euro is likely to stay range-bound or test deeper support near 1.1450 before any recovery attempt.
Short-term traders may consider selling rallies below 1.1600, targeting 1.1450, while maintaining tight stops above 1.1625. A break below 1.1500 could extend bearish momentum into early November.
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