By Robert Petrucci Robert P.
Retail traders have a reason to suspect that price velocity will continue to remain a ripe fruit in the coming hours and next few days. The EUR/USD currency pair is correlating to the broad market and showing signs of being fragile as global market sentiment has shifted from the U.S Federal Reserve pronouncements yesterday, and now focuses on stock market action and the coming U.S mid-term elections next Tuesday. EUR/USD speculators are correct to think plenty of price action will be demonstrated and opportunities will arise.
Fed Hold Leaves December Rate Uncertainty as US Data Looms
While the U.S Fed did not raise its borrowing rate yesterday, it continues to create suspicions that an additional hike could come in December. USD centric strength in the broad Forex market has resumed in this wake of sentiment. And while U.S quarterly earnings from Apple will be seen today, last night’s late Google reporting did the global market little favors showcasing cautious feelings about Wall Street which could create another round of safe haven thinking.
The next test comes with the advance estimate of third-quarter US GDP and September PCE inflation data due later in the session. Together, the releases could reinforce or challenge expectations for another December rate increase, giving EUR/USD traders fresh evidence on whether the dollar’s renewed strength has further support.
The U.S mid-term elections are an obvious influence too for short-term considerations, this as financial institutions position themselves ahead of the outcome. But because the vote in the U.S is bound to be tight and lead to precarious outlooks, it is the reaction in the middle of next week which speculators need to prepare for via the knowledge – between then and now the EUR/USD is likely to remain cautious.
EUR/USD’s Rebound From 1.1125 Shows Limited Conviction
Yesterday’s steep decline in the EUR/USD did touch the 1.11125 vicinity but has managed to reverse slightly and is near 1.11400 now with fast conditions being seen. Traders need to understand that financial institutions are not pleased with central bank attitudes regarding interest rate policies, while inflation is a definite concern it is the price of WTI Crude Oil that is causing a lot of the price pressures. Debate about interest rate policy and the tendency to think the U.S Fed might raise interest rates again in December is causing a wave of EUR/USD selling for the moment.
The question is if support levels will spur a solid reversal higher or if based on the cautious shadow over the broad markets that USD centric strength will continue to flourish until an attitude adjustment occurs. And where exactly that change of sentiment will come from in order to create a positive viewpoint about market conditions is not easy to answer.
Election and Geopolitical Risks Keep EUR/USD Sentiment Cautious
Retail speculators in search of a sudden golden ray of sunshine beaming down on the EUR/USD and creating an upwards march need to remain realistic and push any bias that might be creating those thoughts to the side. Not only is the U.S mid-term election a concern to financial institutions, but the rattling of sabers in the Middle East is not going to change.
If in fact an escalation were to begin at some point in the next week or so in Iran remains a definite negative sentiment on outlooks too. EUR/USD traders may be correct to think resistance levels technically are appropriate to consider selling positions in the currency pair. Upwards traction has been hard to maintain for a handful of days now and there is little reason to suspect optimism will suddenly emerge in the short-term.
EUR/USD Price Chart – Creeping Lower
Recent Lows Remain in Focus as Recovery Attempts Falter
Retail traders considering pursuing upwards positions in the EUR/USD certainly exists. Financial institutions could believe the currency pair had been oversold. The lows tested yesterday touched levels last seen in the middle of October. But here is the rub, the lows also tested long-term technical values last traversed in May of 2025, this after the EUR/USD had touched significantly lower values early in that year. EUR/USD traders looking for upside need to be careful and not be overly ambitious regarding their targets.
Persistent Volatility Leaves EUR/USD Direction Unsettled
Forex trading as USD stronger centric action has returned will likely to continue to offer price velocity even in the EUR/USD which is often rather too slow for some speculators. The velocity seen in the EUR/USD since the middle of September doesn’t appear ready to disappear and traders while craving price movement also have to remember not to get stubborn about chosen directions.
EUR/USD Short Term Outlook:
Current Resistance: 1.11425
Current Support: 1.11360
High Target: 1.11510
Low Target: 1.11190
Robert Petrucci is a Market and Geopolitical Analyst at DailyForex with professional experience in the Forex, commodity, and broader financial markets dating back to 1993. His work focuses on risk analysis, macroeconomic themes, and how geopolitical events affect currencies, commodities, stock indices, and cryptocurrencies. Robert brings a conservative wealth management perspective from his long-standing advisory roles, translating complex market conditions into structured scenarios for traders and investors.
As seen on: Investing.com, TalkMarkets, Angry MetaTraders
