EUR\/USD traded near 1.1730 in late US trading on Friday, giving back most of its earlier gains. The move followed Donald Trump\u2019s threat to raise tariffs on EU cars and trucks to 25% from 15%.<\/p>\n
Iran sent a peace talks offer via Pakistan to seek a deal with the US, with details not disclosed. Trump said progress had been made but he was unsure a deal would be reached, and said he was unhappy with Iran\u2019s latest proposal.<\/p>\n
Asked about possible missile strikes on Iran, Trump declined to answer directly. The uncertainty helped the US dollar recover from a two-week low.<\/p>\n
On the four-hour chart, EUR\/USD stayed around 1.1730 and showed a broadly neutral tone. It held above the 20-period SMA at 1.1713, but remained below the 100-period SMA at 1.1736 and a barrier at 1.1744, while the RSI was near 53.<\/p>\n
Resistance levels were marked at 1.1736 and 1.1744, with further levels at 1.1757 and 1.1785. Support was seen at 1.1729 and 1.1713, and a break below 1.1713 could extend the pullback.<\/p>\n
We remember the uncertainty in 2025 when the US dollar strengthened on threats of tariffs against European cars and escalating tensions with Iran. That geopolitical risk kept the EUR\/USD pair heavy, struggling to maintain levels around 1.1730. The market was pricing in a significant chance of a trade conflict that would hit the Eurozone economy hard.<\/p>\n
Those threats eventually became a reality, and we saw the impact in the fourth quarter of 2025 as German auto exports to the US fell by over 15%. This slowdown, combined with higher energy prices after the Iran talks failed, created a difficult environment for European assets. Consequently, the European Central Bank was forced to maintain a dovish stance well into the new year.<\/p>\n
Now, the landscape is shifting as a new trade dialogue has eased tariff concerns, and the focus is returning to economic fundamentals. First-quarter 2026 data showed Eurozone inflation has climbed to 2.4%, pushed by a recovery in industrial output and the lingering effects of last year’s energy shock. This has changed the tone from the ECB, with policymakers hinting that their long-standing accommodative policy may need to be reassessed.<\/p>\n
With the EUR\/USD now trading near 1.2180, we are seeing a change in the options market. One-month implied volatility has fallen to its lowest level this year, making it cheaper to purchase options contracts. This environment suggests that buying long-dated EUR call options is a viable strategy to position for a potential ECB policy shift later this year.<\/p>\n
The key is to watch for continued strength in European manufacturing PMI data, which has already rebounded significantly from its 2025 lows. A sustained reading above 55 would signal that the economic recovery has firm legs, giving the ECB more room to act. We should therefore structure trades that benefit from a stronger Euro, as the political headwinds of last year have now become tailwinds.<\/p>\n","protected":false},"excerpt":{"rendered":"
EUR\/USD slipped to 1.1730 as Trump tariff threats, Iran uncertainty boosted dollar, leaving pair neutral.<\/p>\n","protected":false},"author":38,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[46],"tags":[],"class_list":["post-46441","post","type-post","status-publish","format-standard","hentry","category-live-updates"],"acf":[],"aioseo_notices":[],"featured_image_src":null,"featured_image_src_square":null,"author_info":{"display_name":"josephine","author_link":"https:\/\/www.vtmarketsglobal.com\/en\/author\/josephine\/"},"_links":{"self":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts\/46441","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/users\/38"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/comments?post=46441"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts\/46441\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/media?parent=46441"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/categories?post=46441"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/tags?post=46441"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}