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The EUR/USD pair rose for the second consecutive week, approaching the 1.1800 level before closing near it. Market participants remained cautiously optimistic about a potential US-Iran deal, despite ongoing geopolitical tensions and a lack of concrete progress in negotiations. The pair's movement reflects a delicate balance between risk-on and risk-off sentiment, with traders closely monitoring developments in the Middle East.
This volatility is critical for forex traders, as EUR/USD is a major currency pair influenced by global geopolitical risks. The Middle East tensions could disrupt oil markets and broader risk appetite, indirectly affecting the euro and dollar. Traders should watch for shifts in sentiment following key diplomatic updates or military escalations.
Looking ahead, the 1.1800 level may act as a psychological barrier, while support is likely near 1.1700. Investors should also track the Federal Reserve's policy stance and European Central Bank's inflation data, which could amplify EUR/USD swings. Geopolitical developments in the region will remain a key wildcard.
