Geopolitical tensions in the Strait of Hormuz drive investors toward the USD, pressuring EUR/USD to near 1.1390 ahead of key US CPI data.
The Euro trades 0.2% lower against the US Dollar at 1.1390 in early Asian trading, weighed by a stronger Greenback. The US Dollar Index (DXY) rises to 101.15 as safe-haven demand surges amid escalating US-Iran military actions over control of the Strait of Hormuz, a critical global energy chokepoint.
EUR/USD remains below its 20-period Exponential Moving Average (1.1443) and a bearish flag pattern, signaling further downside potential. The Relative Strength Index (14) at 38 indicates persistent selling pressure without extreme oversold conditions. Resistance levels are seen at 1.1424 and 1.1443.
Investors await June’s US Consumer Price Index data and Federal Reserve Chair testimony this week for clues on inflation trends and monetary policy direction.