EUR/USD Analysis – November 25, 2025
Original author: Mahmoud Abdallah | Source: DailyForex.com
The EUR/USD currency pair has shown a notable level of fluctuation in recent sessions, with traders closely monitoring key economic indicators and policy signals from both the European Central Bank (ECB) and the U.S. Federal Reserve. The EUR/USD exchange rate is currently stabilizing around the 1.0900 level as traders anticipate further central bank commentary and important economic data releases from both sides of the Atlantic.
The trading activity on Monday was distinctly subdued due to the closure of U.S. markets for the Thanksgiving holiday, encountering low volumes that led to narrow price ranges. However, technical analysis still provides valuable insight into key support and resistance areas, alongside potential breakout zones in the near term.
Current Market Overview
– At the time of writing, the EUR/USD pair is trading near the 1.0900 handle, having tested this figure several times over recent sessions.
– The Euro continues to draw strength from a mixture of technical factors and moderate risk appetite, while the Dollar remains constrained by softer U.S. Treasury yields and cautious bets on Federal Reserve tightening.
– The low volatility on Monday due to the U.S. Thanksgiving holiday means the market lacked significant directional impetus but continued to inch higher above key technical thresholds.
The broader rally in EUR/USD over the past few weeks has been driven by a consistent theme of U.S. Dollar weakness, triggered by shifting Fed expectations. Market sentiment implies that the Federal Reserve has likely concluded its rate-hiking cycle, leading to pressure on the greenback. Meanwhile, the ECB has kept its tone relatively steady, neither strongly dovish nor aggressively hawkish, which has helped support the single European currency.
Technical Outlook for EUR/USD
From a technical analysis perspective, the EUR/USD pair is exhibiting a bullish tone on the daily chart. The current price action suggests that the Euro retains upward momentum, provided it remains above key support areas.
Key Support Zones:
– 1.0845: This marks a pivotal short-term support. A sustained break below this level could prompt the market to target the next downside area.
– 1.0800: Serving as a psychological level, this area previously acted as resistance and now offers support.
– 1.0725: Deeper support level, representing a strategic zone where the bulls are likely to regroup if the previous levels fail to hold.
Key Resistance Levels:
– 1.0965: This resistance represents a short-term target. A break above this level could fuel additional bullish movement.
– 1.1000: A rounded psychological benchmark and previously contested level. If breached, it may initiate fresh buying interest.
– 1.1070: A high from earlier in the year; breaking above this would indicate a significant breakout and continuation of medium-term bullish sentiment.
Patterns and Indicators:
– The pair remains above both the 50-day and 200-day Simple Moving Averages (SMAs), reinforcing a generally bullish market structure.
– Relative Strength Index (RSI) hovers near overbought territory but has not produced a reversal signal, implying there is still room for further upside.
– MACD (Moving Average Convergence Divergence) indicator shows a widening gap between its moving averages, signaling continued momentum on the upside.
Fundamental Drivers Influencing EUR/USD
1. U.S. Economic Data and Federal Reserve Policy:
– One of the most influential factors in EUR/USD movements is the outlook on the U.S. economy and the Federal Reserve’s monetary policy stance.
– Recent economic indicators from the U.S. — such as softer inflation metrics and weakening labor market signals — have fueled speculation that the Fed will maintain rates and potentially pivot toward easing in 2024.
– These expectations weigh on the U.S. Dollar as reducing rate premiums dampens currency appeal.
2. Eurozone Policy and Economic Sentiment:
– The ECB is observing a gradual decline in inflation, though economic output
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