EURUSD Dips Ahead of U.S Inflation Data

The EURUSD currency pair has experienced a downward trend over the past four weeks, with the pair continuing its decline by ten basis points into the new week.  

This downward momentum can largely be attributed to the strengthening of the U.S. Dollar, fueled by several key factors, including a robust labour market and subdued expectations of a rate cut. Notably, the latest U.S. Nonfarm Payrolls report, surpassing expectations by nearly double, significantly bolstered the Greenback, prompting a shift in rate cut expectations from 77% down to 17.5% for March.  

This sudden shift has further reinforced the Dollar’s position, as higher yields often attract increased demand for the currency. As traders eagerly await Tuesday’s U.S. inflation rate data, the focus remains on deciphering the potential implications for future monetary policy decisions, shaping the direction of the EURUSD pair in the near term.  


The EURUSD pair has been firmly entrenched in a downtrend, with prices consistently trading below the 100-day moving average, signalling bearish sentiment. Further reinforcing this trend is the presence of a descending channel pattern, affirming the downward trajectory.  

Overbought RSI conditions at the 1.08975 resistance level, aligning with the upper boundary of the channel, triggered the recent selloff, prompting a decline towards the key support level at 1.07238. However, a reversal has ensued, with oversold RSI conditions emerging at this support level, suggesting potential upward movement. 

Currently, the 50% Fibonacci Retracement level acts as a crucial obstacle to further upside momentum. Should selling pressures persist, a retest of the 1.07238 support level is likely. Conversely, a breakout above the 50% level, accompanied by high volume, could indicate a renewed market appetite for the upside, potentially propelling prices towards the 61.80% Golden Ratio level. Traders will likely closely monitor these technical indicators and market dynamics to navigate potential shifts in the EURUSD price action. 


With the EURUSD downtrend fueled by a robust U.S. Dollar, traders eagerly await U.S. inflation data for insights into future monetary policy. Technical analysis indicates bearish sentiment, with resistance at 1.08975 and support at 1.07238. The 50% Fibonacci Retracement level poses a critical barrier to the upside. 

Sources: CME, Reuters, TradingView 

Piece Written By Nkosilathi Dube, Trive Financial Market Analyst 

Disclaimer: Trive South Africa (Pty) Ltd (hereinafter referred to as “Trive SA”), with registration number 2005/011130/07, is an authorised Financial Services Provider in terms of the Financial Advisory and Intermediary Services Act, 37 of 2002. Trive SA is authorised and regulated by the South African Financial Sector Conduct Authority (FSCA) and holds FSP number 27231. Trive Financial Services Ltd (hereinafter referred to as “Trive MU”) holds an Investment Dealer (Full-Service Dealer, excluding Underwriting) Licence with licence number GB21026295 pursuant to section 29 of the Securities Act 2005, Rule 4 of the Securities Rules 2007, and the Financial Services Rules 2008. Trive MU is authorized and regulated by the Mauritius Financial Services Commission (FSC) and holds Global Business Licence number GB21026295 under Section 72(6) of the Financial Services Act. Trive SA and Trive MU are collectively known and referred to as “Trive Africa”.

Market and economic conditions are subject to sudden change which may have a material impact on the outcome of financial instruments and may not be suitable for all investors. Trive Africa and its employees assume no liability for any loss or damage (direct, indirect, consequential, or inconsequential) that may be suffered. Please consider the risks involved before you trade or invest. All trades on the Trive Africa platform are subject to the legal terms and conditions to which you agree to be bound. Brand Logos are owned by the respective companies and not by Trive Africa. The use of a company’s brand logo does not represent an endorsement of Trive Africa by the company, nor an endorsement of the company by Trive Africa, nor does it necessarily imply any contractual relationship. Images are for illustrative purposes only and past performance is not necessarily an indication of future performance. No services are offered to stateless persons, persons under the age of 18 years, persons and/or residents of sanctioned countries or any other jurisdiction where the distribution of leveraged instruments is prohibited, and citizens of any state or country where it may be against the law of that country to trade with a South African and/or Mauritius based company and/or where the services are not made available by Trive Africa to hold an account with us. In any case, above all, it is your responsibility to avoid contravening any legislation in the country from where you are at the time.

CFDs and other margin products are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how these products work and whether you can afford to take the high risk of losing your money. Professional clients can lose more than they deposit. See our full Risk Disclosure and Terms of Business for further details. Some or all of the services and products are not offered to citizens or residents of certain jurisdictions where international sanctions or local regulatory requirements restrict or prohibit them.