As the risks worsen, bears regain control of the EUR/USD early Monday. The primary currency pair had a negative gap at the start of the week and ended at 0.9920-25.

As traders worried about China’s restrictions on covid and Russia’s geopolitics, the global markets became less willing to take risks. Traders may have been concerned because they didn’t know what the Fed would do next.
The Wall Street Journal (WSJ) says that a high-level White House official is having secret talks with top Putin advisers.

The day before, EURUSD bulls helped Fedspeak, mixed US job numbers, and aggressive comments from the ECB.

US Nonfarm Payrolls for October were 261K, which was lower than what was expected (200K) and what was seen before (315K). The markets were shocked when the unemployment rate went from 3.5% to 3.6% to 3.7%.
On Friday, Christine Lagarde, the European Central Bank (ECB) head, said, “We need to raise rates to reach our long-term inflation goal of 2%.”

Benchmarks on Wall Street and US Treasury yields went up at the end of the day. The US Dollar Index (DXY) went down, which caused commodity and Antipodean prices to go up. S&P 500 Futures lose 0.75 per cent intraday.
Before Thursday’s CPI report, EURUSD traders may be interested in Fedspeak and second-tier US and Eurozone data (CPI).

Conclusion

The market’s view of what the Fed will do next changed, which made EURUSD bearish, but bulls are still in the game.