Over the weekend, U.S. President Donald Trump and European Commission President Ursula von der Leyen announced the signing of a new trade agreement following their meeting in Scotland.
The deal includes a 15% baseline tariff on European exports to the U.S., with some exemptions. This mirrors a similar agreement previously signed between the U.S. and Japan.
President Trump emphasized:
→ The baseline tariff for Europe would not drop below 15%.
→ The EU committed to investing in the U.S., including weapons purchases and energy imports.
Market Reaction
→ European stock indices opened with a bullish gap, reflecting relief that feared 30% tariffs were avoided.
→ The EUR/USD pair turned bearish, showing downward momentum this morning.
EUR/USD Technical Outlook
The pair dipped toward the 1.1700 level early Monday, a zone that acted as resistance in mid-July (see black arrow). The median line of the ascending channel (in blue) is now capping price action. After a brief rally (highlighted in purple), selling pressure returned, suggesting bearish control.
If this momentum continues, a break below 1.1700 could lead to further downside toward the lower boundary of the ascending channel.
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