EUR/USD Extends Decline as Fed Signals Pause in Rate Cuts

The US dollar is strengthening after the release of the minutes from the October 28–29 meeting. Although policymakers approved a 25-basis-point rate cut, their views on future actions diverged sharply. Most FOMC members believe that any additional cuts this year are unjustified and expressed concern over key economic issues — a cooling labor market and inflation that “shows no signs of sustainably returning” to the 2.0% target. As a result, supporters of a pause in the easing cycle currently outnumber those favoring further cuts. However, today’s labor-market report at 13:30 GMT could reshape market sentiment: unemployment is expected to hold at 4.3%, while nonfarm payrolls are projected to rise by 53K after 22K previously. A weaker-than-expected release could revive expectations of a December rate cut and put pressure on the dollar.

Analysts do not expect any action from the European Central Bank (ECB) in the near term either, as inflation in the eurozone remains close to target. In October, headline CPI stood at 2.1% and core CPI at 2.4%, while Q3 GDP grew by 0.2%. Against this backdrop, the ECB is unlikely to adjust interest rates before the end of the year.

Support and resistance levels

The pair continues a downward correction within the broader long-term uptrend. The key level for sellers remains 1.1475 (Murray level [0/8]), which was tested earlier this month. A firm breakout below would open the path toward 1.1353 (Murray level [–2/8]) and 1.1230 (Murray level [6/8], W1). Conversely, a breakout above 1.1658 (Murray level [5/8]), above the upper Bollinger Band, would allow the pair to exit the descending channel and target 1.1841 (Murray level [6/8]) and 1.1920 (the area of yearly highs).

Technical indicators confirm the downside bias: Bollinger Bands continue to slope downward, MACD remains stable in negative territory, and Stochastic is approaching oversold conditions — a signal that a corrective rebound is possible, although its upside potential appears limited.

Resistance levels: 1.1658, 1.1841, 1.1920.

Support levels: 1.1475, 1.1353, 1.1230.

Trading scenarios and EUR/USD forecast

Selling positions are preferable below 1.1475, targeting 1.1353 and 1.1230, with a stop-loss at 1.1570. Implementation horizon: 5–7 days.

Buying positions become relevant above 1.1658, targeting 1.1841 and 1.1920, with a stop-loss at 1.1560.