The recent movement of the EUR/USD has attracted considerable market attention, with the exchange rate oscillating repeatedly between 1.07 and 1.09, never quite breaking out into a decisive trend. The core contradiction lies in the divergence of monetary policy paths between the two major economies, the US and Europe. On the US side, although inflation data has eased somewhat, the employment market and consumer data remain resilient. Federal Reserve officials continue to signal that they are not in a hurry to cut interest rates, providing solid support for the dollar. In contrast, the Eurozone's economic growth has significantly slowed, with manufacturing and services PMI figures remaining weak for several months. The European Central Bank faces more urgent growth pressures than inflation pressures, and the market generally expects the ECB to be the first to initiate rate cuts within the year.

This shifting expectation of interest rates is theoretically unfavorable for the euro. However, market views on the dollar are also divided; the US's large fiscal deficit and debt issues cause some investors to doubt the dollar's long-term value. As a result, EUR/USD has not experienced a one-sided decline but has instead shown a tug-of-war pattern. From a technical perspective, the daily chart indicates that the exchange rate is generally near the upper boundary of a downward channel. The 1.09 resistance level has been tested multiple times without success, forming a short-term strong resistance; meanwhile, the 1.07 area shows strong demand support. If 1.07 is effectively broken downward, the downside space will open up; if the rate can break through 1.09 and stabilize, a corrective rebound may follow.

Key upcoming events worth watching include the Eurozone and US PMI final figures, US non-farm payroll data, and speeches from major central bank officials, all of which could serve as catalysts to break the current stalemate. Until the direction becomes clearer, it is advisable to adopt a range-bound approach and manage positions carefully. What are your views on the future trend of the Euro and US dollar? How long can the dollar's strength last? Looking forward to your insights.