EUR/USD remains on the defensive as US Dollar rises on thin trading

💡 DMK Insight

EUR/USD’s six-day slide is raising eyebrows, especially after last week’s peak above 1.1800. The recent dip below 1.1730 signals a potential shift in market sentiment, largely driven by a modest rebound in the US Dollar following the Fed’s December meeting minutes. Traders should note that this could indicate a tightening bias from the Fed, which often leads to dollar strength. If the pair continues to falter, the next key support level to watch is around 1.1700. A break below this could trigger further selling pressure, particularly from algorithmic traders and institutions looking to capitalize on bearish momentum. On the flip side, if EUR/USD manages to reclaim 1.1750, it could suggest a temporary bottom, inviting buyers back into the market. Keep an eye on economic indicators from both the Eurozone and the US in the coming days, as they could provide additional context for this currency pair’s direction. The immediate focus should be on the 1.1700 support level and any Fed commentary that could sway the dollar’s strength.