Daily Market Update
December 01, 2025| EUR/USD ranged from the high 1.15’s to the mid 1.16’s overnight. The US Dollar is broadly softer as traders lean into the idea of a Fed rate cut in December, giving the risk complex some extra lift. All eyes now turn to the upcoming US PMI figures to see whether the move has more room to run. In the 4-hour chart, EUR/USD trades at 1.1637, up for the day by 30 pips above the opening. The 100-period Simple Moving Average (SMA) edges higher near 1.1574, with price extending above it to preserve a bullish tone. The rising slope suggests steady buying pressure and keeps the bias supported by the average. The Relative Strength Index (RSI) stands at 67, reflecting firm momentum approaching overbought territory. A break of the descending trend line from 1.1919 around 1.1595 shifts the technical picture to the upside. Immediate resistance aligns at 1.1656, followed by 1.1728. A move through the first hurdle could expose the latter. The pair holds above a rising trend line from 1.1491, which offers support near 1.1578. The SMA continues to slope upward, and EUR/USD remains above it, keeping the advance intact. RSI stays elevated, consistent with a momentum-led grind higher. Support is seen at 1.1500, then at 1.1469. Holding above 1.1578 would maintain the bullish bias, while a pullback toward the trend-line support would need to be defended to prevent a deeper retracement into the cited support band. EUR/USD moves higher at the start of the week and trades around 1.1635 at the time of writing, its highest level in two weeks. The pair is extending a rebound mainly fueled by persistent softness in the US Dollar (USD), while transatlantic macroeconomic prospects continue to shift in favor of the Euro (EUR). The final November Purchasing Managers Index (PMI) for the Eurozone, revised slightly lower to 49.6, failed to slow the single currency’s advance. Developments in the United States (US) largely shape the movement, as investors now expect the Federal Reserve (Fed) to deliver a 25-basis-point rate cut next week, followed by several more rate cuts in 2026. This broad repricing of interest rate expectations is weighing on US yields and, in turn, on the USD. Markets are also watching political developments in Washington. According to Reuters, US President Donald Trump is considering appointing economist Kevin Hassett, known for his dovish stance, as the next Fed Chair. Such a nomination would reinforce expectations of a much more accommodative policy outlook in the coming quarters, adding further pressure on the US Dollar. Later in the day, attention will turn to the release of the November Institute of Supply Management (ISM) Manufacturing PMI, expected to ease slightly to 48.6, still in contraction territory. Key sub-components, particularly the Prices Paid index and the Employment indexes, will be closely monitored as investors assess whether the US slowdown is deepening. A weaker-than-expected print would solidify expectations of an imminent Fed policy pivot. Looking ahead, this week brings a dense sequence of macroeconomic catalysts likely to influence EUR/USD. The Harmonized Index of Consumer Prices (HICP) in the Eurozone on Tuesday, Services PMIs on Wednesday, and the US Personal Consumption Expenditures (PCE) Prices Index, the Fed’s preferred inflation measure, on Friday. With every data release interpreted through the lens of the upcoming rate-cut cycle, volatility may remain elevated. In this environment, EUR/USD maintains a constructive bias as long as markets remain convinced that the Fed will start easing in December. For now, market dynamics continue to hinge on diverging monetary-policy expectations, and on that front, the balance still leans in favor of the Euro. Source: FX Street |
