Key Points:
- EUR/USD peaked at $1.0947 before retreating to $1.0907, still near a five-month high.
- Markets react to Ukraine’s ceasefire agreement, but tariff uncertainty weighs on sentiment.
- US stocks fluctuated overnight, as investors worried about growth and trade policies.
The euro hovered near $1.0907 on Wednesday, holding onto recent gains after Ukraine expressed readiness to accept a one-month ceasefire proposal. This development boosted investor sentiment, lifting European stock futures, with Euro Stoxx 50 futures up 0.8% and FTSE futures gaining 0.3%.
The EUR/USD pair reached its highest level since October at $1.0947 in New York trade before settling lower in the Asian session. The ruble also strengthened, hitting a seven-month high overnight.
Stock Markets Whipsawed by Tariff Concerns
On Wall Street, the S&P 500 fell 0.8%, flirting with a 10% decline from its February record as trade tensions escalated. President Donald Trump threatened—then retreated from—doubling tariffs on Canadian steel and aluminium to 50%, adding to the market’s uncertainty.
The dollar weakened, while Treasuries rallied, reflecting investors’ concerns that tariff uncertainty and shifting policies could hinder U.S. economic growth.
Technical Analysis
The EUR/USD pair is down 0.11%, with price action showing a slight pullback after reaching a high of 1.09471. The session saw a low of 1.09055, and the pair is currently trading near 1.09072, consolidating after an earlier rally. The moving averages (5, 10, 30) suggest a pause in momentum, while the MACD is flattening, indicating potential consolidation before the next move.
Picture: EUR/USD consolidates near 1.0907 after testing 1.0947 resistance, as seen on the VT Markets app
For further upside, a break above 1.0947 could drive the pair toward 1.0960-1.0980, where resistance may strengthen. On the downside, support is near 1.0900, and a break below this level could lead to a retracement toward 1.0880-1.0860. Traders should watch for ECB policy comments, U.S. inflation data, and overall risk sentiment, as these will shape the next directional move.
With steel and aluminium tariffs set to take effect, traders remain cautious. U.S. inflation data for February is due later, though analysts expect it to be too early to reflect the impact of new tariffs.
