The currency pair remains range-bound below last week’s highs amid low volumes and mixed signals on US-Iran diplomacy.
The Euro traded flat against the US Dollar at 1.1644 on Monday, unable to break above last week’s highs near 1.1675. The pair remains close to seven-week lows at 1.1575, with thin holiday trading volumes limiting movement.
Market sentiment was lifted by hopes of a Middle East peace deal after US President Trump suggested a possible agreement with Iran. However, Iran’s Foreign Ministry reiterated that Strait of Hormuz management belongs to coastal nations, tempering optimism. US markets were closed for Memorial Day, further reducing liquidity.
Focus shifts to ECB President Lagarde’s speech on Wednesday and US PCE inflation data on Thursday. Technical analysis shows the pair trapped in a sideways range, with no clear directional catalyst.