EUR/USD breaks below trend support on French political turmoil
EUR/USD has broken below critical trend line support at 1.0970, declining 0.5% to 1.0940 as French political uncertainty weighs heavily on the euro. Rising tensions in France's parliament over budget negotiations have sparked concerns about fiscal stability in the eurozone's second-largest economy. The break below the ascending trend line dating from October lows signals a potential shift in momentum, with technical indicators turning bearish. Immediate support lies at 1.0920 (50-day MA), while resistance has formed at the broken trend line near 1.0970. RSI has dropped below 50, confirming weakening momentum. Political risk premium in French assets has widened, with OAT-Bund spreads expanding to 85 basis points. The euro's weakness could accelerate if political deadlock persists, potentially targeting 1.0850 support zone. Traders should monitor French political developments closely.
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