The EUR/USD currency pair continued its decline for the fourth consecutive trading day on Friday, falling by 0.15% to trade near 1.1653 during the Asian session [1]. This downward movement was attributed to ongoing strength in the US Dollar, which advanced following positive outcomes from a meeting between US President Donald Trump and Chinese leader Xi Jinping on Thursday [1]. Both leaders indicated that trade relations are expected to improve and emphasized the importance of keeping the Strait of Hormuz open [1].
The US Dollar Index (DXY), which measures the Greenback against six major currencies, rose by 0.15% to approach 99.00, marking its highest level in two weeks [1]. The US Dollar was particularly strong against the New Zealand Dollar, gaining 0.43%, and also posted gains against other major currencies including the Euro (+0.16%), British Pound (+0.21%), and Japanese Yen (+0.08%) [1].
Market sentiment was further influenced by expectations that the Federal Reserve will not cut interest rates this year, which has contributed to the US Dollar's strength [1]. In contrast, a Reuters poll indicated that a majority of economists anticipate the European Central Bank (ECB) will raise interest rates at its June policy meeting [1].
From a technical perspective, EUR/USD remains bearish in the near term, trading below the 20-day Exponential Moving Average (EMA) at 1.1710 and confirming a Double Top formation breakdown after falling below the April 30 low of 1.1655 [1]. The Relative Strength Index (RSI) is around 44, suggesting that downside pressure persists [1].
CONCLUSION
EUR/USD's continued decline reflects a combination of US Dollar strength, positive US-China trade developments, and diverging central bank expectations. Technical indicators point to sustained bearish momentum for the pair, with market participants closely watching upcoming policy decisions from the Federal Reserve and ECB.