EUR/USD struggles amidst thin trading volumes and lack of economic catalysts. Focus shifts to Friday's PMI releases from the EU and US, which are expected to provide mixed signals.
EUR/USD experienced a slight decline on Wednesday, falling approximately one-tenth of a percent. Market activity remained subdued, with little noteworthy economic data released. The usual torrent of trade war rhetoric from US President Donald Trump has temporarily subsided, leaving traders with few catalysts for significant price movements. Thursday's trading session is anticipated to follow a similar pattern, characterized by a sparse economic calendar.
The US Federal Reserve (Fed) has entered its customary pre-meeting blackout period ahead of next week's interest rate decision, while the European Central Bank (ECB) faces a limited ability to influence market sentiment at this juncture. ECB President Christine Lagarde's Wednesday appearance garnered minimal attention.Traders seeking directional cues will likely focus on Friday's release of Purchasing Managers Index (PMI) figures for both the EU and the US. Analysts anticipate mixed results, with services sector activity projected to weaken or stagnate in the EU, and manufacturing activity showing a modest recovery in both regions. PMI figures typically exert a limited impact unless they deviate substantially from forecasts. However, survey respondent rates have tended to be low, prompting caution in interpreting the overall figures.From a technical perspective, EUR/USD bulls encountered resistance near the 50-day Exponential Moving Average (EMA) around 1.0460, failing to breach the 1.0450 level and prompting a retreat towards the 1.0400 handle. Despite technical indicators signaling oversold conditions and a rebound of 2.75% from last week's two-year lows below 1.0200, sustained bullish momentum remains elusive. Traders anticipating a longer-term bullish correction should await confirmation of a higher low pattern before seeking technical buy signals
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