The Euro had a rough trading day on Friday, starting with a drop due to the threat of a 50% tariff on EU goods. However, it regained strength when the US Dollar weakened, ending the day at 1.1379. The EU is dedicated to reaching a trade deal with the US, focusing on respectful negotiation rather than threats. Although the US considered increasing tariffs on EU goods, the deadline for this decision has been pushed to July 9.

Euro Resistance and Support Levels

The outlook for the Euro is looking up, although trading has been stable among major currencies. Key resistance levels are at 1.1420/30. If the Euro breaks through these levels, it could rise to 1.1570. If it fails to break through resistance, the Euro might return to its recent trading ranges. Important support levels are at 1.1280, 1.1235, and 1.1150, which are based on moving averages and Fibonacci retracement levels. The Euro’s initial drop and subsequent recovery highlight how global sentiment swings—short periods of fear followed by adjustments as new information comes to light. The initial drop was directly linked to tariff threats, which can cause confusion but often don’t change overall trends unless acted upon. The Euro’s strength came more from a weak dollar than from positive movements within the Eurozone, which is important if you’re tracking this currency pair closely. When we say the risk is tilted upwards, we mean that buyers are beginning to support the Euro more. However, we haven’t yet surpassed the critical resistance levels at 1.1420 and 1.1430, where many short sellers gather due to significant technical interest. If these levels are breached, we could see significant upward momentum towards 1.1570, where longer-term investments may settle.

Market Behavior Insights

If the Euro fails to break those resistance levels, it’s likely to drift lower. In this scenario, expect a quiet retreat through support levels. At 1.1280, there’s some support from short-term averages. If it goes down to 1.1235 or even 1.1150, it would indicate that Friday’s bounce didn’t change the market’s structure, just provided a momentary lift. Fibonacci levels are not predictive but reflect what traders are watching for and whether they are ready to act when prices approach these levels. Few traders are making bold moves right now. However, a pause at resistance can offer good setups for short-term trades if you manage your risk wisely. Wider market signals continue to influence the overall tone, but immediate trading opportunities are developing around these set technical boundaries. What we’ll be paying attention to in the upcoming sessions is not just whether prices break through but also how market participation responds through volume, breadth, and correlations with equity and debt markets. Tariff threats, like the one seen before Friday, can lead to quick reactions that aren’t usually sustained unless actual policy changes follow the rhetoric. Considering the impact of the July 9 deadline, we might see cautious moves leading up to that date, especially involving short-term volatility. There’s an opportunity to focus on spreads rather than making outright directional bets. Create your live VT Markets account and start trading now.

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