EUR/USD price prediction: Euro climbs to $1.0845 as markets eye German industrial data
EUR/USD rally stalls at 1.0885 as technical resistance limits gains.
EUR/USD price movement in March began with strong upward momentum, gaining 4.6% in the first trading week. However, the advance was halted at the 1.0885 resistance level, preventing the pair from testing a five-month high of 1.0936.
Following the rejection at 1.0885, EUR/USD retraced by 0.7%, finding support at the 1.08 psychological level, which was reinforced by the 50 EMA on the 1-hour chart. As of Monday’s European session, the pair has rebounded to trade near 1.0845, keeping the five-month high within reach.
Friday’s Nonfarm Payrolls (NFP) report showed a weaker-than-expected job growth of 151,000 in February, missing the market forecast of 160,000. Additionally, January’s figures were revised downward to 125,000 from 143,000. The soft labor market data adds pressure on the U.S. dollar, as it strengthens the case for rate cuts later this year.
Despite concerns over a slowing U.S. economy, Federal Reserve officials remain measured in their stance. San Francisco Fed President Mary Daly indicated that while uncertainty is rising among businesses, it does not yet warrant immediate changes to interest rates. Investors are now looking ahead to German Industrial Production data and the Eurozone Sentix Investor Confidence index for further directional cues.
EUR/USD RSI warns of short-term retracement amid weak U.S. economic data
EUR/USD price dynamics (Feb 2025 - March 2025). Source: TradingView.
Technically, last week’s surge pushed EUR/USD into overbought territory, raising the risk of a short-term pullback. A decisive break below $1.08 could lead to further declines, potentially erasing a portion of the recent gains. However, weaker U.S. economic data has provided underlying support for the pair, as the market assesses the potential impact on Federal Reserve policy.
Overall, EUR/USD maintains an upward bias but faces technical resistance at 1.0885. A break above this level could open the door to 1.0936, while failure to sustain gains may bring the 1.08 support level back into focus. The market’s reaction to the upcoming economic releases and evolving Fed expectations will determine the pair’s next trajectory.
The U.S. dollar weakened as falling Treasury yields and Fed rate cut expectations pressured the currency. EUR/USD rebounded from $1.0855 resistance, extending its March gains.
