EURUSD
Fundamental Perspective
The EURUSD pair touched a two-month low of 1.0900 before finishing the week slightly higher at 1.0940. The US Dollar initially lost ground but recovered following the release of the FOMC's September minutes. The minutes revealed that most participants viewed inflation risks as less concerning, with a significant majority supporting a 50 bps rate cut, though some favored a 25 bps reduction. Policymakers also noted that the risks to both inflation and employment are now more balanced.
US inflation data for September exceeded expectations, with the Consumer Price Index rising 0.2% for the month and 2.4% annually. However, these figures weren't enough to shift expectations for the Fed's 25 bps rate cut in November. Recent labor market data also pointed to a more robust economy than anticipated.
German factory orders fell 5.8% in Europe in August, while industrial production rose 2.9%. The ECB's minutes revealed expectations for inflation to rise before falling by late 2025, though recent weak manufacturing data points to near-term headwinds.
Markets are now focused on the ECB's upcoming policy decision, with widespread anticipation of a 25 bps rate cut. Meanwhile, economic releases, including Germany's ZEW sentiment survey and US retail sales, will be closely watched next week.
Technical Perspective
The weekly chart pattern creates a possible double-top pattern, enabling optimism for sellers in the upcoming weeks. However, investors look at the price reaction to the possible neckline of the double-top pattern.
On the daily chart, the price declines at the EMA 200 line but still floats below the EMA 100 line, indicating a mixed signal. If the price bounces back above the EMA 100 line, it will declare significant bullish pressure toward the primary resistance near 1.1030, followed by the next resistance near 1.1197.
On the other hand, the bearish continuation below the EMA 200 line could enable the door for the nearest support near 1.0801, followed by the next support near 1.0690.
