**Weekly Forex Analysis: EUR/USD, GBP/USD, and USD/CAD**
*Adapted from original analysis by Wael Makarem at FXStreet. Supplemented by insights from recent Reuters FX reports.*
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Global foreign exchange markets have been highly active over the past week, with traders focusing on the implications of shifting monetary policy, central bank commentary, and evolving economic data across the Eurozone, United Kingdom, United States, and Canada. This comprehensive analysis provides an in-depth look at recent price trend developments across the EUR/USD, GBP/USD, and USD/CAD pairs, alongside market drivers and potential implications for currency traders in the coming sessions.
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### Macro Themes Dominating the ForeX Landscape
**Central Bank Policy Divergence**
– The primary narrative shaping currency moves has been divergence in monetary policy among major central banks: the US Federal Reserve, the European Central Bank (ECB), and the Bank of England (BoE).
– Markets are also responding to commentary from the Bank of Canada on its policy trajectory.
– Recent inflation readings, labor market statistics, and consumer spending patterns have not only directed central bank tone but also swung expectations on interest rate moves, which are crucial to FX pricing.
**Strong Dollar Resilience**
– The US Dollar has generally maintained strength against a basket of currencies, reflecting perceived resilience of the American economy and delayed expectations for rate cuts.
– Meanwhile, both the Euro and British Pound faced moments of pressure, each shaped by specific regional economic challenges.
**Risk Sentiment and Geopolitical Headwinds**
– Periods of risk aversion linked to geopolitical events, especially in Eastern Europe and the Middle East, have supported the greenback via safe-haven inflows.
– Commodity currencies, including the Canadian Dollar, have been incfluenced by swings in oil prices and global trade concerns.
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### EUR/USD: Drag from Economic Underperformance
**Price Action Overview**
– The EUR/USD pair slipped from recent highs, trading within a relatively defined range as traders weighed dovish signals from the ECB against still-strong data out of the US.
– Recent sessions saw the Euro failing to gain meaningful ground as the US Dollar strengthened, keeping the pair below large moving averages.
**Key Drivers**
– **ECB Policy Stance:** The European Central Bank has begun to signal possible interest rate reductions on the horizon, driven by subdued inflation and sluggish growth across major Eurozone economies.
– **Macro Data Divergence:** BlackRock and other major asset managers have flagged the relative outperformance of US macro releases. In contrast, recent German industrial production data and French consumer indices disappointed, underlining Eurozone economic frailty.
**Support and Resistance Zones**
– **Support:** Firm buying appeared near 1.0800, with potential to retest these levels if downside pressure re-emerges.
– **Resistance:** The 1.0880 zone remains key; moves above could invite further upside toward 1.0940 and the psychological 1.1000 level.
**Technical Perspective**
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