Yesterday, President Trump’s decision to impose a 25% tariff on auto imports put pressure on the euro. Traders began slightly increasing their speculation that the European Central Bank might introduce additional easing measures this year, anticipating a potential blow to the European economy. Recently, the yield differentials between the EU and the US have favored the American side, a shift that became more pronounced once the initial surge spurred by the German defense spending news started to diminish.
Looking at the one-hour chart, there’s a clear trend line limiting the upward movement of the EURUSD pair. This chart paints a classic picture of a downtrend. Sellers will likely continue to use this trend line as a point of resistance, aiming to push prices to new lows while managing their risks just above the trend line. Meanwhile, buyers are hoping for a breakthrough, seeking to drive the price higher and set their sights on new peaks.
