EUR/USD trades near 1.1570 as dollar weakens ahead of Fed decision and U.S. data

According to data from the Centre for European Economic Research (ZEW), Germany’s Current Conditions Index in November broke a three-month decline and came in at –78.7 points compared to –80.0 previously, while investor sentiment fell from 39.3 to 38.5 points. Across the eurozone, the composite sentiment index rose from 22.7 to 25.0 points, remaining in positive territory for the seventh consecutive month. Commenting on these figures, ZEW President Achim Wambach noted that confidence in the government’s ability to solve economic challenges continues to weaken. While the government’s stimulus program may support business growth, structural issues remain unresolved.

The U.S. dollar index (USDX) stands near 99.40, maintaining a downward bias as investors await the official end of the government shutdown and upcoming macroeconomic data. The bill to fund the government through the end of January has already been sent to the House of Representatives, where Speaker Mike Jones is expected to approve it and pass it on to President Donald Trump for signing. Preliminary estimates from Automatic Data Processing (ADP) show that private employers have been cutting an average of 11,250 jobs per week, signaling a potential rise in unemployment. Additionally, the currency faces pressure from a lower probability of a Federal Reserve rate cut in December — now estimated at 65.4% according to CME FedWatch Tool data.

According to CME FedWatch Tool data:

• 63.4% of market participants expect a 25-basis-point rate cut to the 3.50–3.75% range,
• 36.6% anticipate the rate will remain unchanged at 3.75–4.00%.

The current rate remains in the 3.75–4.00% range, indicating that most investors still expect a dovish Fed policy stance by the end of 2025.

Support and Resistance Levels

On the daily chart, the pair is retreating from the recently tested support line of the descending channel, which has boundaries at 1.1600–1.1350.

Technical indicators maintain a bearish signal: the fast EMAs of the Alligator indicator remain below the signal line, narrowing the trading range, while the Awesome Oscillator (AO) histogram forms correction bars in the negative zone.

Resistance levels: 1.1660, 1.1860.

Support levels: 1.1480, 1.1210.

Trading Scenarios and EUR/USD Forecast

Short positions can be opened after the price declines and consolidates below 1.1480, targeting 1.1210. Stop-loss — near 1.1560. Estimated duration: 7 days or more.

Long positions can be opened after the price rises and consolidates above 1.1660, with a target near 1.1860. Stop-loss — 1.1580.