EUR/USD plunges after brief US-EU trade deal optimism fades

EUR/USD experienced significant volatility, initially rising on reports of potential US-EU trade negotiations before sharply reversing to close 0.8% lower at 1.0785. The pair briefly touched 1.0895 on optimism surrounding trade talks, but sentiment quickly soured as details emerged suggesting limited scope for immediate agreement. Market participants grew concerned about persistent trade tensions and their impact on Eurozone growth prospects. The rapid reversal triggered stop-losses above 1.0900, accelerating the downward move. Technical indicators show EUR/USD breaking below the 50-day moving average at 1.0820, with immediate support at 1.0750. The failed breakout attempt has shifted near-term momentum bearish, with traders now eyeing upcoming ECB and Fed policy meetings for direction. Risk sentiment remains fragile, favoring safe-haven flows into the dollar over the euro.