EUR/USD price in range-bound movement ahead of U.S. economic data
Euro finds support above 1.0500 amidst French political uncertainty and US data focus
Despite some early European session gains, the EUR/USD price has been hovering around the psychological 1.0500 level since Tuesday, trading within a tight band between 1.0535 and 1.0480, with the 200-hour Exponential Moving Average (EMA) acting as immediate resistance at 1.0535.
This technical resistance level has capped any significant upward momentum in the pair, and traders are likely to pay attention to whether the price can break or hold this level for a sustained move. Additionally, the Relative Strength Index (RSI) below 50 suggests weak momentum, signaling that the market is favouring downside risks in the near term.
EUR/USD price dynamics (November-December 2024). Source: TradingView.
The looming political uncertainty in France is also adding to market hesitation. The no-confidence vote against Prime Minister Michel Barnier, supported by far-right and left-wing factions, raises the possibility of a government collapse. This situation has sparked concerns about stability in the eurozone's second-largest economy, which could put further pressure on the euro. With these risks hanging over the market, EUR/USD traders are likely to hold on to bearish sentiment.
Market turns to US data for EUR/USD price prediction
On the US front, investors are keeping an eye on upcoming US data, including the ADP Employment Change report and the ISM Services PMI for November. Economists expect the US private sector to have added only 150K jobs in November, a sharp slowdown from October’s 233K increase. Furthermore, a decline in the Services PMI to 55.5 from 56.0 could signal a broader slowdown in the economy, potentially weighing on the US Dollar. This data, along with the Fed’s Beige Book and Chair Jerome Powell’s speech, will likely provide important clues on future monetary policy direction.
In the near term, EUR/USD is expected to remain range-bound, with the key level of 1.0500 acting as both a psychological and technical pivot point. Any further developments in the political situation in France or the US economic data could provide the necessary catalysts for a breakout.
Signs of easing U.S. monetary policy expectations gave the euro some breathing room. EUR/USD price climbs 0.42% above 1.0500 amid French political turmoil.
