EUR/USD Gains as Europe Stabilizes While Fed Signals Dovish Shift

EUR/USD has strengthened amid signs of European economic stabilization and increasingly dovish Federal Reserve rhetoric. Recent data shows European economic indicators improving from previous lows, reducing recession fears and supporting the euro. Meanwhile, Fed officials have hinted at a more cautious approach to future rate hikes, acknowledging growing economic headwinds in the US. This policy divergence has shifted market dynamics in favor of the euro. Technical indicators suggest building bullish momentum, with the pair breaking above key moving averages. The dollar index has retreated from recent highs as traders reassess the Fed's hawkish stance. Near-term resistance lies at 1.0950, while support has formed at 1.0850. A sustained break above resistance could open the path toward 1.1000, particularly if upcoming US economic data disappoints and reinforces the Fed's dovish pivot.