Looking back at the euro's performance over the past two years, it's still quite interesting. Many people were asking at the time whether the euro would fall further, but in fact, it rebounded in the first half of 2024.

The logic is actually quite simple. Starting from the end of 2023, both the Federal Reserve and the European Central Bank entered into expectations of interest rate cuts, but their paces were different. The signals from the Fed were more aggressive, while the ECB was relatively conservative, which led to the dollar being somewhat strong in the short term. But by early 2024, the market started to reprice, realizing that the Fed might cut rates more significantly and sooner, which was actually negative for the dollar.

I looked at several key factors at the time. First, economic fundamentals—although inflation was still present in the U.S., the economy was more resilient than the Eurozone. The Eurozone was recovering from recession, while the U.S. hadn't entered a recession to begin with. Second, political factors—2024 is a U.S. election year, with candidates making exaggerated promises and promising a bunch of unrealistic policies, which is temporarily favorable for the dollar. But in the second half of the year, as the election heated up, market expectations for the U.S. economy would become increasingly exaggerated, ultimately becoming negative.

So the judgment at the time was that the euro might be slightly stronger in the first half of the year, but the trend would reverse in the second half. From a technical perspective, weekly signals also looked bullish, but monthly signals were more neutral.

Looking back at the entire 2024, the euro against the dollar indeed rose first and then fell, roughly in line with expectations. The Fed started cutting rates earlier in the first half, followed by the ECB, leading to a rebound in the euro during that period. But in the second half, with the U.S. presidential race intensifying, Trump running again, and market optimism about the U.S. economy pushed to the extreme, the dollar strengthened in the short term, putting pressure on the euro.

Now it's 2026, and whether the euro will fall again is already a historical question. But looking back at this history, you'll find that the exchange rate movements boil down to a few logics: central bank policy pace, economic cycle differences, and major political events. As long as you grasp these, you can roughly judge the direction. The economic cycles of the Eurozone and the U.S. are still evolving, and central bank policies are also adjusting, so the future trend of EUR/USD remains worth paying attention to.