• The EUR/USD price analysis indicates renewed dollar weakness.
• Trump announced a new 100% tariff on films produced outside the US.
• Data on Monday showed further expansion in the US services sector.

The EUR/USD price analysis indicates renewed euro strength as US tariff uncertainty weighs on the dollar. It has become clear that Trump is unwilling to give up his tariff campaign. At the same time, market participants stay off the market ahead of the crucial FOMC policy meeting. 

On Sunday, Trump announced a new 100% tariff on films produced outside the US, pausing the dollar’s recent rally. Initially, demand for the US currency had soared amid hopes of easing trade tensions. Trump had announced looming trade deals with Japan, India, and South Korea. Moreover, the US president said there was hope for a deal with China in the near future. As a result, risk appetite surged and investor confidence rebounded.

However, at the start of the week, uncertainty arose when Trump returned to his aggressive tariff moves. This paused the dollar’s rally, allowing the euro to climb on Tuesday. Still, the move was subdued after recent economic figures revealed a resilient US economy. Data on Monday showed further expansion in the services sector as business activity improved more than expected. 

Meanwhile, Friday’s employment numbers were positive. As a result, Fed rate cut expectations have eased. Still, policymakers might hint at the future during this week’s meeting.

EUR/USD key events today

• Federal Funds Rate
• FOMC Statement
• FOMC Press Conference

EUR/USD technical price analysis: Bulls aim for the 1.1550 resistance

(Click on image to enlarge)

EUR/USD 4-hour chart

On the technical side, the EUR/USD price is about to break out of a tight wedge pattern near the 1.1301 support level. Bulls are challenging the 30-SMA and the wedge resistance line. At the same time, the RSI has edged above 50, indicating stronger bullish momentum. 

Initially, the price was in a solid uptrend, respecting the 30-SMA as support. At the same time, it was making higher highs and lows. However, this stopped after bulls failed to break above the 1.1550 resistance level. 

Bears emerged at this level and pushed the price below the SMA, indicating a shift in sentiment. The next step for bears was to start making lower highs and lows. However, the 1.1301 support has held firm. Therefore, a break above the SMA and the wedge resistance will allow EUR/USD to retest the 1.1550 level.

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