Ella 
EUR/USD struggled to capitalize on the strong gains seen over the past two days, settling into a tight range during the Asian session on Tuesday. Spot prices are currently trading around 1.0800, almost flat throughout the day and just below the one-week high hit on Monday.
Traders now appear more willing to wait for key central bank event risks to arrive this week, leading to EUR/USD remaining range-bound, before taking on aggressive positions. Federal Reserve Chairman Jerome Powell’s congressional testimony on Wednesday and Thursday will be viewed as clues on the path of interest rate cuts. This, along with the European Central Bank’s (ECB) monetary policy decision on Thursday, will help determine the pair’s near-term direction.
In addition, investors will also welcome important U.S. macro data released at the beginning of the new month this week, including the closely watched monthly employment data, Friday’s non-farm payrolls report (NFP). At the same time, bets on a quick rate cut by the European Central Bank have dwindled, continuing to boost the euro. On the other hand, expectations that the Federal Reserve will start cutting interest rates in June have weakened the dollar, providing support for EUR/USD.
Still, a slight deterioration in global risk sentiment and weaker equities favored the safe-haven dollar, limiting the pair’s upside. EUR/USD cautiously awaits strong follow-through buying before rebounding from sub-1.0700 levels (or the three-month low hit on February 14). Ahead of the release of the US ISM Services PMI, traders are now looking to the final Eurozone Services PMI to provide some impetus.
