Euro holds near four-year highs as ECB rate decision looms

💡 DMK Insight

EUR/USD’s flat trading around 1.1800 signals indecision, but here’s why that matters: After hitting a four-year high near 1.2082, the pullback suggests traders are reassessing their positions. This consolidation phase could indicate a brewing volatility, especially as we approach key economic data releases. If the pair breaks below 1.1750, it could trigger a wave of selling, while a push above 1.1850 might reignite bullish momentum. Keep an eye on the U.S. economic indicators this week, as they could provide the catalyst for a breakout or further consolidation. Also, watch the correlation with the DXY index; a strengthening dollar could weigh on EUR/USD, while weakness might support a recovery. On the flip side, the current flatness might also be a strategic pause before the next big move. If traders are waiting for clearer signals from the Fed or ECB, this could lead to a buildup of positions that might explode once the market gets direction. So, monitor those levels closely and be ready for potential swings.