EUR/USD traded near 1.1865 on Monday and was mostly unchanged. The move came after weak Eurozone industrial production data and thin trading volumes.
Eurozone industrial production fell 1.4% in December, versus a 1.5% drop expected. November was revised down to 0.3% growth from 0.7%.
On a yearly basis, output rose 1.2%. That was below the 1.3% forecast and down from 2.5% in November. EUR/USD stayed stuck in its recent range.
Trading was quiet because many Asian markets, including Japan, were closed for the Lunar New Year. US markets were also shut for President’s Day.
Later, markets were set to hear from Federal Reserve Vice Chair for Supervision Michelle Bowman and ECB Governor Joachim Nagel. These speeches came before a busier week of data.
On the 4-hour chart, EUR/USD held above a rising trendline near 1.1855, with extra support at 1.1833. MACD sat just below zero, and RSI was just under 50.
A break below 1.1833 would put 1.1775 in focus. Resistance was seen at 1.1890, then 1.1925.
Looking back to this time last year, in February 2025, EUR/USD was steady near 1.1865 even as Eurozone factory output looked weak. Trading was also very quiet, helped by holidays in the US and Asia. That low-volatility setup is very different from today’s market.
The Eurozone’s underlying weakness seen in the December 2024 data has continued. The latest December 2025 figures show industrial production fell 0.7% month-on-month, according to Eurostat. This ongoing softness helps explain why EUR/USD is now struggling to hold above 1.09, far below the levels discussed a year ago.
In early 2025, attention was on softer US CPI data, which gave the Fed room to consider rate cuts. By February 2026, the picture has reversed. US inflation remains sticky, running at 2.9% year-on-year last month, which has kept the Fed on hold. At the same time, the ECB is sounding more open to cuts. This policy gap continues to pressure the euro.
For derivatives traders, this calls for a different playbook than last year’s range trading. With major inflation and jobs data due from both economies in the coming weeks, EUR/USD straddles may offer a way to benefit from a volatility jump, regardless of direction. Implied volatility is near 8.2%, well above the sub-6% levels seen in the quiet February 2025 period, suggesting traders expect larger moves.
The technical backdrop has also weakened a lot over the past year. The 1.1833 support level watched in February 2025 is now far above the market and would likely act as major resistance. Today’s key level is around 1.0850, and a clean break below it could lead to more selling.
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