EUR/USD: Strategic Long Bias at $1.1769 Amid Pre-Fed Rate Cut Optimism

The EUR/USD pair has entered a pivotal phase in November 2025, . This level, reinforced by recent price action and broader market positioning, , driven by pre-Fed rate cut optimism and evolving USD dynamics.

Technical Price Action: A Confluence of Key Levels

The EUR/USD has been consolidating around , a level identified as a mid-range resistance point in multiple analyses. This level aligns with the mid-point of an ascending regression channel, suggesting its significance as a potential breakout catalyst. On the bullish side, the pair remains above key moving averages, including the 20-period and 50-period SMAs, while the RSI at 63 indicates robust bullish momentum. Buyers maintain control as long as the price stays above , with immediate resistance at and .

However, the market is in a neutral mode, consolidating between and due to delayed U.S. CPI data. This indecision creates a high-probability setup for a breakout or breakdown. On the downside, and the daily Fair Value Gap (FVG) from August at act as key psychological barriers. A break below 1.1522 could accelerate the pair toward or even . For bulls, a sustained close above would invalidate the bearish bias and open the path to , with further upside potential toward if the breakout gains momentum.

Macroeconomic Positioning: Fed Policy and USD Weakness

According to the currency commentary, the Federal Reserve's anticipated dovish pivot has intensified pressure on the U.S. dollar, with rising expectations of a rate cut in December 2025 halting earlier USD recovery and keeping it rangebound.This shift has increased the likelihood of a multi-year bear market for the dollar, . The EUR/USD pair, while currently underperforming due to eurozone growth concerns, benefits from this broader USD weakness.

The European Central Bank (ECB) is expected to maintain its deposit rate of 2% through the December meeting according to market analysis, creating a widening rate differential that could further weaken the euro against the dollar. However, the euro's challenges have limited its upside potential (such as sluggish growth, German fiscal uncertainty, and French political gridlock). Meanwhile, the ECB has warned that a weaker dollar could amplify the negative effects of U.S. tariffs on eurozone exporters, adding complexity to the euro's near-term outlook.

The upcoming Non-Farm Payrolls (NFP) data will be a critical catalyst. A weak labor market report could accelerate Fed rate cut expectations, further weakening the USD and boosting EUR/USD. Conversely, a strong NFP might delay rate cuts and allow the dollar to rebound. This volatility underscores the importance of a strategic entry at , where technical and macroeconomic factors align to favor a long bias.

: Balancing Risk and Reward

For traders, the EUR/USD setup at offers a risk-reward asymmetry. A breakout above this level, supported by a dovish Fed and ECB rate stability, could drive the pair toward and beyond. Stop-loss placement below would protect against a breakdown scenario, while .

The long bias is further reinforced by safe-haven flows into gold, which have added downward pressure on the USD. As the market awaits the delayed CPI data and the Fed's December decision, EUR/USD positioning remains skewed to the downside in the short term. However, the broader bearish trend for the euro is expected to resume once the dollar's multi-year bear market gains traction, making a strategic entry point for those betting on a pre-Fed rate cut rally.

Conclusion

The EUR/USD pair stands at a crossroads, with technical price action and macroeconomic positioning converging to support a long bias at . While near-term volatility from CPI and NFP data introduces uncertainty, the Fed's dovish trajectory and ECB rate stability create a favorable backdrop for a breakout above . Traders who position themselves at this level can capitalize on a potential multi-year trend, leveraging both technical momentum and macroeconomic tailwinds.