Euro skyrockets amid softer US confidence

EUR/USD rises around 0.3% and approaches 1.1400 as the US Dollar Index falls toward 101.30.
German IFO Business Climate improved to 86.6, driven by a sharp recovery in companies’ expectations.
US Consumer Confidence declined to 90.8, while the Bundesbank said Germany likely recorded modest second-quarter growth.

EUR/USD trades higher near the 1.1400 area on Tuesday, gaining around 0.3% as the US Dollar (USD) weakens following softer United States (US) consumer-confidence data. The US Dollar Index falls toward 101.30, helping the Euro extend its recovery.

TMGM Analysis: Financial Market News, Economic Calendar & Market Insights

The Conference Board Consumer Confidence Index declined to 90.8 in July from an upwardly revised 92.2 in June. The Present Situation Index fell for a third consecutive month to 114.9, while the Expectations Index remained unchanged at 74.7 and stayed below the level generally associated with recession concerns. The figures suggest that US households remain cautious about current business and labor-market conditions.

Germany’s Bundesbank added that the economy likely expanded slightly in the second quarter despite headwinds from the Middle East conflict and elevated energy prices. The central bank highlighted resilient industrial activity, stronger foreign demand and growing exports, while consumer spending probably remained at least stable. However, it warned that growth could lose some momentum in the third quarter as temporary supportive factors fade, while higher energy costs could lift inflation again.

Short-term technical analysis:

On the 4-hour chart, EUR/USD trades at 1.1399. The pair hovers around a key pivot at 1.1399 after reclaiming the short-term floor, with the 20-period Simple Moving Average (SMA) at 1.1380 now lending nearby support. Price, however, still trades beneath the 100-period SMA at 1.1416, which keeps the broader topside constrained even as the Relative Strength Index (RSI) near 54 hints at mildly improving momentum rather than outright bullish conditions.

On the downside, immediate support is seen at the 1.1399 pivot, followed by a confluence of the 20-period SMA and horizontal support around 1.1380, ahead of additional floors at 1.1374 and 1.1361. On the topside, initial resistance is defined by the 1.1399 pivot on any intraday pullback failure, with the 100-period SMA at 1.1416 acting as the next meaningful cap that bulls would need to clear to extend the recovery.

(The technical analysis of this story was written with the help of an AI tool. Know more.)