- The EUR / USD is moving in a range during the first part of the trading action on Monday.
- A combination of factors continues to prop up the USD and limit the pair’s rally.
- The Fed’s pessimistic outlook prevents USD bulls from opening aggressive positions and offers some support to the pair.
The pair EUR/USD lacks a strong directional bias and oscillates between timid gains and minor losses, about 1.1550, during the European session on Monday.
The pair struggled to capitalize on the previous session’s modest recovery move from post-NFP lows to the lowest since July 2020 and hovered within a tight range during the early part of Monday’s trading action. Softer Risk Tone Around Asian Stock Markets, coupled with a strong rally in US Treasury yields, they propped up the us dollar and they acted as a headwind for the EUR / USD pair.
The USD was further supported by the optimistic monthly employment report of the United States on Friday, which showed the economy created 531,000 new jobs in October. Additionally, the August and September figures were also revised up to show another 235,000 jobs in those months. Having said that, pessimistic outlook from the Fed prevented USD bulls from opening aggressive positions, which offered some support to the EUR / USD pair, at least for now.
As was widely expected, the US central bank announced last week a reduction of 15,000 million dollars to your monthly asset purchases. At the press conference after the meeting, Fed Chairman Jerome Powell reiterated that inflation is transitory and that authorities were in no rush to increase borrowing costs. This, in turn, did not provide any significant boost to the USD and led to a subdued and limited price action in a range around the EUR / USD pair.
There is no major economic data release on Monday, neither from the eurozone nor from the United States. Therefore, the focus will be on Powell’s remarks at an online conference later during the US session, which will influence USD price dynamics and generate some opportunities around the EUR / USD pair.
EUR / USD technical levels