The EURUSD pair saw a notable spike today, rising above the 100-hour moving average. This upward movement was fueled by positive developments in trade negotiations between the European Union and the United States. Earlier in the day, the euro faced downward pressure due to weaker inflation data from France and Spain, along with an increase in Germany’s unemployment rate and jobless claims.
However, the sentiment turned around following reports that the EU is preparing to offer concessions in response to the U.S. reciprocal tariffs implemented by the Trump administration. Bloomberg reported that the EU aims to partially remove existing U.S. tariffs that have negatively impacted EU exports and are set to increase further after April 2. EU officials learned during meetings in Washington that new auto and reciprocal tariffs were imminent.
As a result, the European Commission has begun drafting a potential deal, which involves negotiating tariff reductions, fostering mutual investments, and easing regulatory standards.
Positive trade talk boosts EUR/USD
The U.S. tariffs are targeting both tariff and non-tariff barriers, such as tax policies and digital regulations, which the Trump administration deems as unfair trade practices.
The promising signs of progress in resolving these trade disputes have provided a boost to the EURUSD pair. The currency pair has now surpassed the 100-hour moving average, currently at 1.07889 and trending lower, reaching new session highs near 1.0807. Important upside targets include the high of a swing area from early March and the 200-hour moving average, which the price dropped below on March 20.
Adding to the bullish sentiment, today’s low held within a crucial swing zone between 1.07609 and 1.07767—an area of support that dates back to October/November 2024. Additionally, the price bounced off the key 200-day moving average and the 38.2% retracement level this week, marking a critical hold for buyers that shifted the market sentiment from bearish to bullish. The recent price action underscores the intricate relationship between economic indicators and geopolitical developments, emphasizing the importance for traders to stay informed about both domestic and international factors that can influence currency markets.
