The EUR\/USD is trading at 1.1715, down from its previous high above 1.1800. The US Dollar’s strength is linked to recent US labour figures, while European data is weak, with Germany’s business sentiment and Eurozone inflation figures falling short.<\/p>\n
Eurozone’s Harmonized Index of Consumer Prices for November was revised downwards. Additionally, Germany’s business climate showed a decline for the second month in a row. In the US, employment numbers dropped for October but rose more than expected in November. Nevertheless, the Unemployment Rate hit a four-year high, and wage growth slightly declined.<\/p>\n
The Euro has weakened ahead of the European Central Bank meeting. Expectations are low for any interest rate changes. Eurostat revised the Eurozone’s November inflation rate to 2.1% annually. German data indicated a downturn in business climate in December, falling to 87.6 from 88.0.<\/p>\n
In the US, Retail Sales were stagnant in October, and the Manufacturing and Services PMIs in the Eurozone have also shown declines. US employment data revealed fluctuations in October and November. The EUR\/USD faces bearish pressure. It needs to hold above 1.1685 for the broader uptrend, with a potential downtrend if support fails.<\/p>\n
Given the current softness in the Euro, we see opportunities in positioning for further downside in the near term. The EUR\/USD is struggling around 1.1715 after disappointing German business confidence figures and a downward revision of Eurozone inflation to 2.1%. This confirms the European Central Bank has little reason to consider tightening policy, making the Euro less attractive.<\/p>\n
On the other side of the pair, the US labor market data is messy but points toward a slowdown. The unemployment rate hitting a four-year high of 4.6% is a significant signal that keeps expectations of a Federal Reserve rate cut alive for March. We’ve seen this before; back in late 2023, similar expectations of a Fed pivot led the CME FedWatch Tool to price in a more than 75% chance of a cut by the following March, causing significant dollar volatility.<\/p>\n
This divergence between a clearly dovish ECB and a potentially dovish Fed creates a complex trading environment. With the ECB meeting this Thursday and several Fed officials speaking, implied volatility is likely to increase. Derivative traders should consider buying options to play this expected rise in price swings, rather than taking a simple directional bet.<\/p>\n
The technical picture points to a critical support level for EUR\/USD at 1.1685. A decisive break below this level could trigger a quick move toward the 1.1600 area. We would view a breach of this support as a signal to buy weekly puts or establish short positions in EUR futures contracts.<\/p>\n
Looking back at the end of 2023, we saw a similar dynamic where markets tried to price in the future paths of central bank policy. That period was defined by sharp reversals as new data came in, rewarding traders who were positioned for volatility. The current situation in late 2025 feels very similar, suggesting that straddles or strangles could be effective strategies over the next few weeks.<\/p>\n","protected":false},"excerpt":{"rendered":"
EUR\/USD weakens as strong US labor data contrasts with softer Eurozone inflation, Germany sentiment ahead of ECB.<\/p>\n","protected":false},"author":62,"featured_media":0,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-37119","post","type-post","status-publish","format-standard","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts\/37119","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/users\/62"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/comments?post=37119"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts\/37119\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/media?parent=37119"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/categories?post=37119"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/tags?post=37119"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}