The EUR\/USD sees a decrease to around 1.1730 during the early European Wednesday session, faced with renewed US Dollar demand. This decline occurs as the ECB is expected to leave interest rates unchanged for a fourth consecutive meeting, continuing a steady 2% key deposit rate since July.<\/p>\n
The US labour market data shows resilience with signs of slowing. November’s Nonfarm Payrolls increased by 64,000, exceeding estimates of 50,000, while the unemployment rate nudges up to 4.6% from 4.4% in October, possibly putting downward pressure on the dollar.<\/p>\n
In technical analysis, EUR\/USD trades at 1.1732, with the 100-day EMA at 1.1611 suggesting an upward bias. The RSI at 65.58 reflects robust momentum, with resistance at 1.1788 and support at 1.1639 and 1.1611 respectively, indicating a potential bullish outlook unless capped by resistance.<\/p>\n
The European Central Bank, based in Germany, oversees Eurozone monetary policy, primarily focusing on maintaining price stability around 2% inflation. The ECB’s strategies, including interest rate adjustments and quantitative easing, greatly impact the Euro’s strength.<\/p>\n
Quantitative easing, enacted during financial crises, tends to weaken the Euro, while quantitative tightening, which ceases bond buying, typically supports the currency.<\/p>\n
As we look at the situation, the EUR\/USD was hovering around 1.1730 ahead of the European Central Bank’s December rate decision. The ECB met expectations last Thursday by holding its key deposit rate at 2.0%, providing some clarity to the market. This stability has allowed the pair to push through previous technical barriers.<\/p>\n
Recent economic data now provides a clearer picture than the mixed US jobs report from November 2025. The latest Eurozone inflation figures show core HICP holding firm at 2.6%, reinforcing the idea that the ECB is done cutting rates for now. Conversely, US Core PCE, the Fed’s preferred inflation gauge, recently eased to 2.8%, increasing speculation that the next move from the US will be a rate cut in the first half of 2026.<\/p>\n
This policy divergence has propelled the pair above the 1.1788 resistance level, which we now see as a potential new support zone. In the coming weeks, derivative traders should watch for a potential test of the 1.2000 psychological level. Buying call options with strikes above 1.1900 could be a viable strategy to position for further upside.<\/p>\n
With the ECB meeting now in the past, implied volatility has likely decreased, making options strategies relatively less expensive. Traders could consider using pullbacks toward the 1.1788-1.1800 area to initiate long positions via futures contracts. Using protective put options below 1.1750 can help manage the risk of a sharp reversal.<\/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 1.1730 as US Dollar demand rises; ECB maintains rates, technicals hint bullish.<\/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-37074","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-ca\/wp-json\/wp\/v2\/posts\/37074","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/users\/62"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/comments?post=37074"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/37074\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media\/16959"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media?parent=37074"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/categories?post=37074"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/tags?post=37074"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}