The EUR/USD currency pair traded near 1.1540 on Monday as market participants digested mixed sentiment data from the Eurozone and positioned themselves ahead of the European Central Bank's (ECB) upcoming interest rate decision later in the week [1]. The latest Sentix Investor Confidence index for June showed an improvement, rising to -13.4 from the previous reading of -16.4. While the index remains in negative territory, the less pessimistic outlook provided modest support to the Euro [1].
Market focus is now on Thursday's ECB policy announcement, with expectations that policymakers will implement another interest-rate hike due to inflation remaining above the central bank's target. Investors are also expected to closely monitor ECB President Christine Lagarde's comments for any indications regarding the potential for further monetary tightening in the coming months [1].
From a technical perspective, EUR/USD maintains a bearish near-term bias, trading below both the 20-period Simple Moving Average (SMA) at 1.1587 and the 100-period SMA at 1.1621. The Relative Strength Index (RSI) is near 38, indicating ongoing downside pressure but not yet reaching oversold conditions. Key resistance levels are identified at 1.1544 and 1.1555, with a break above these needed to alleviate immediate selling pressure. On the downside, support is seen at 1.1533 and 1.1516, with a breach of the latter likely reinforcing the bearish outlook and potentially leading to further declines [1].
CONCLUSION
The Euro received modest support from improved investor sentiment, but the market remains cautious ahead of the ECB's policy decision. Technical indicators suggest a bearish bias persists for EUR/USD, with traders awaiting further direction from the central bank's announcement and President Lagarde's guidance.