The EUR\/USD experienced a decline to a new weekly low of around 1.1740 as the US Dollar remained steady. Despite the US Dollar index reaching a weekly high near 98.25, most Federal Open Market Committee members endorsed interest rate cuts if inflation drops as anticipated.<\/p>\n
The FOMC’s minutes indicated a need to return to a neutral policy to prevent job market decline. The CME FedWatch tool forecasts a 50 basis points cut in interest rates by the Fed in 2026. Meanwhile, the Euro’s activity is muted with the ECB expected to maintain interest rates, as Eurozone inflation remains close to the 2% target.<\/p>\n
The technical analysis shows EUR\/USD trading at 1.1744, above a rising 20-day EMA at 1.1724, with a positive near-term bias. RSI is at 58, indicating a supportive momentum. The decline from recent peaks has reduced but remains constructive if the price holds above the 20-day EMA.<\/p>\n
The Federal Open Market Committee reviews economic conditions over eight meetings a year. The FOMC Minutes, released three weeks post-policy decision, can influence the US Dollar, with market reactions potentially delayed as outlets await publication access.<\/p>\n
With the EUR\/USD near 1.1740, we see a classic standoff between central banks as we head into 2026. The Federal Reserve is openly talking about cutting interest rates to support the US job market. This contrasts with the European Central Bank, which seems content to hold steady for now.<\/p>\n
This policy difference is the main story for the coming weeks. We saw in the November 2025 jobs report that US payrolls grew by only 150,000, missing expectations and giving the Fed more reason to ease policy. With US inflation having cooled to 2.8% in the latest readings, there is little pressure on the Fed to stay aggressive.<\/p>\n
Meanwhile, the Eurozone’s situation appears more stable, supporting the Euro. The latest Eurostat data showed headline inflation holding at 2.1%, right near the ECB’s target. This removes any urgency for the ECB to consider rate cuts, creating a fundamental argument for a stronger Euro against the Dollar.<\/p>\n
From a derivatives standpoint, this suggests looking at bullish strategies on the EUR\/USD. The technical level of 1.1724 is the key support to watch; as long as we hold above it, buying call options with strikes above the 1.1800 resistance could be a sound play. The low trading volume at the end of the year often means implied volatility is cheap, making options attractive.<\/p>\n
Historically, after the aggressive rate hike cycle we saw in 2022 and 2023, a shift toward easing policy has weakened the dollar. The current market pricing, with the CME FedWatch tool indicating at least two rate cuts in 2026, confirms this expectation. Therefore, positioning for a potential break higher in EUR\/USD in early January seems logical.<\/p>\n
Traders should be mindful that the pair is currently struggling to advance. A break below the 20-day average at 1.1724 would signal that this bullish outlook is premature and a period of consolidation is more likely. The first full trading week of January 2026 will be critical to see if buying interest returns with higher market participation.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" EUR\/USD dips to 1.1740 as FOMC minutes suggest rate cuts; technicals show potential support holding.<\/p>\n","protected":false},"author":62,"featured_media":16959,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-37983","post","type-post","status-publish","format-standard","has-post-thumbnail","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\/37983","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=37983"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts\/37983\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/media\/16959"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/media?parent=37983"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/categories?post=37983"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/tags?post=37983"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}