The EUR/USD pair is sliding for the second consecutive session Friday, trading below the mid-1.1400s level after failing to break above the 200-period simple moving average on the four-hour chart. The renewed downward pressure stems from resurgent inflation concerns tied to energy markets, which are reigniting expectations that the US Federal Reserve may maintain its hawkish stance on interest rates. This dynamic is strengthening the US Dollar across the board. The currency pair’s weakness is being amplified by escalating geopolitical tensions between the United States and Iran, adding a risk-off element that typically favors safe-haven dollar demand. Traders are closely monitoring energy prices as crude volatility threatens to keep inflation elevated, potentially forcing the Fed to delay any pivot toward rate cuts. The technical rejection near the 200-SMA on the H4 timeframe suggests immediate bullish momentum has stalled.
FXnCO Insight
EUR/USD traders should watch crude oil movements and Fed commentary closely, as sustained energy-driven inflation could keep dollar strength intact and pressure the pair toward lower support levels.
Source: FXStreet