EUR/USD Eyes Gains as European Markets Set for Positive Open

EUR/USD is positioned for potential upside as European stock markets prepare for a positive opening following the Christmas break. The pair currently trades near 1.0440, with bullish sentiment in European equities likely to support the euro against the dollar. Holiday-thinned liquidity conditions are expected to amplify price movements, creating opportunities for short-term traders. While specific economic data releases are limited during the holiday period, the overall risk-on sentiment in European markets suggests increased appetite for the euro. Geopolitical uncertainties continue to linger in the background, though their immediate impact appears muted. Technical indicators show EUR/USD testing resistance at 1.0450, with a break above potentially targeting 1.0480. Support remains firm at 1.0420. Traders should remain cautious of potential volatility spikes due to reduced market participation, while the positive equity market correlation could provide directional cues for the currency pair in the near term.