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United Overseas Bank’s (UOB) Quek Ser Leang sees EUR/USD retaining a mild downside bias after slipping below a prior strong support at 1.1405. Intraday losses are expected to be limited to tests of 1.1390, with resistance at 1.1430–1.1445. Over the coming weeks, the pair is now viewed as range-trading between 1.1360 and 1.1465, with 1.1210 the next target if key supports fail.

Euro-Dollar shifts back into range trading"24-HOUR VIEW: While we indicated yesterday that EUR “could edge lower,” we held the view that “any decline is likely to be contained within a 1.1405/1.1450 range.” EUR subsequently rose to 1.1449, dipped to a low of 1.1402 before settling at 1.1414 (-0.22%). The price action has resulted in a slight increase in downward momentum, and we continue to expect EUR to edge lower today. This time around, any decline is likely limited to a test of 1.1390. Resistance is at 1.1430; a breach of 1.1445 would suggest that the current mild downward pressure has eased."

"1-3 WEEKS VIEW: Last Thursday (16 Jul, spot at 1.1470), we highlighted that while EUR “is likely to trade with an upside bias, it is too early to determine whether there is sufficient momentum for EUR to reach the significant resistance level at 1.1520.” Yesterday, EUR dipped below our ‘strong support’ level at 1.1405 with a low of 1.1402. The breach of our ‘strong support’ level indicates that upward momentum has faded. The current price movements are likely part of a range-trading phase, which is expected to be between 1.1360 and 1.1465."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

EURUSD: ⬇️ Sell

– EURUSD reversed from resistance level 1.1465

– Likely to fall to support level 1.1370

EURUSD currency pair recently reversed from the resistance level 1.1465 (top of earlier wave a) intersecting with the 50% Fibonacci correction of the downward impulse from June.

The downward reversal from the resistance level 1.1465 (also strengthened by the upper daily Bollinger band) started the active impulse wave iii.

Given the clear daily downtrend, EURUSD currency pair can be expected to fall further to the next support level 1.1370 (low of earlier wave b).

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EUR/USD edges lower on Monday after reversing earlier gains as markets swing between risk-on and risk-off sentiment. At the time of writing, the pair trades around 1.1408, easing from an intraday high of 1.1449.

Middle East headlines shape price action at the start of the week in the absence of major economic data releases. The Euro (EUR) climbed earlier in the day as the US Dollar (USD) weakened after Reuters reported that mediators had proposed a 10-day pause in strikes to help revive the interim US-Iran deal. Officials from both countries also signalled that they remained open to diplomacy.

However, sentiment turned cautious again after a separate Reuters report said Yemen’s Iran-aligned Houthis had declared an immediate naval blockade against Saudi Arabia. Markets quickly rotated back toward the US Dollar, wiping out EUR/USD’s earlier gains.

The US Dollar Index (DXY), which tracks the Greenback’s value against a basket of six major currencies, trades around 101.00, recovering from an intraday low of 100.65.

Oil prices have rebounded to their highest level in more than a month since fighting between the US and Iran resumed earlier in July, keeping energy-driven inflation risks in focus and raising the possibility that price pressures could pick up again after cooling in both the Eurozone and the US in June.

Against this backdrop, markets expect both the European Central Bank (ECB) and the Federal Reserve (Fed) to maintain a tight policy stance. The ECB is widely expected to leave its Deposit Facility Rate unchanged at 2.25% on Thursday, although markets are fully pricing in a rate hike by September. Meanwhile, the CME FedWatch Tool shows that the probability of a Fed rate hike in September stands at around 63%.

“Tighter monetary policy when the Eurozone economy is still operating below potential is more likely to limit EUR downside than push the currency higher because it raises the likelihood of a downward adjustment to ECB rate expectations,” Brown Brothers Harriman (BBH) analysts said.

ECB FAQs The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy for the region. The ECB primary mandate is to maintain price stability, which means keeping inflation at around 2%. Its primary tool for achieving this is by raising or lowering interest rates. Relatively high interest rates will usually result in a stronger Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.

In extreme situations, the European Central Bank can enact a policy tool called Quantitative Easing. QE is the process by which the ECB prints Euros and uses them to buy assets – usually government or corporate bonds – from banks and other financial institutions. QE usually results in a weaker Euro. QE is a last resort when simply lowering interest rates is unlikely to achieve the objective of price stability. The ECB used it during the Great Financial Crisis in 2009-11, in 2015 when inflation remained stubbornly low, as well as during the covid pandemic.

Quantitative tightening (QT) is the reverse of QE. It is undertaken after QE when an economic recovery is underway and inflation starts rising. Whilst in QE the European Central Bank (ECB) purchases government and corporate bonds from financial institutions to provide them with liquidity, in QT the ECB stops buying more bonds, and stops reinvesting the principal maturing on the bonds it already holds. It is usually positive (or bullish) for the Euro.

DBS Group Research’s Philip Wee argues that the Euro (EUR) may find support in coming weeks as markets reassess geopolitical risks and central bank divergence. He highlights investor unease over Federal Reserve (Fed) Chair Kevin Warsh’s push to end forward guidance, contrasting it with the European Central Bank’s (ECB) clearer framework. The analysis focuses on EUR/USD’s potential to break its recent trading range.

ECB clarity contrasts Fed uncertainty push"Against this volatile geopolitical backdrop, the coming fortnight may underpin the EUR, driven by a market preference for the European Central Bank’s new and transparent Framework Guidance over Fed Chairman Kevin Warsh’s campaign to end forward guidance."

"The ECB has flagged a tactical pause at its governing council meeting on July 23. However, the market is currently pricing in an 87.8% chance of a 25-bps hike to 2.50% at the subsequent September 10 meeting. If the ECB affirms this trajectory, the EUR/USD pair could break above this month’s tight range of 1.1360 to 1.1480."

"Conversely, Warsh’s testimony to US lawmakers last week confirmed his intention to restore an "uncertainty premium" to the market’s pricing for a September hike. Warsh plans to use the July 28-29 FOMC meeting to foster an "honest internal discussion" with his colleagues at the Fed."

"Markets will become anxious that slashing the FOMC statement and Warsh’s refusal to provide his own forecasts at his first FOMC meeting in June could be a prelude to stripping the dots and the Summary of Economic Projections of their market-moving authority at the September meeting."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

The Euro (EUR) trades marginally lower to near 1.1432 against the US Dollar (USD) during the European trading session on Monday. The major currency pair edges down as the US Dollar recovers its early losses.

At press time, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades marginally higher to near 100.77.

The Greenback bounces back even as oil prices have retreated amid hopes of de-escalation in ongoing military aggression between the United States (US) and Iran. Higher oil prices de-anchor inflation projections that prompt Federal Reserve (Fed) interest rate expectations, a scenario that is favorable for the US Dollar.

This week, investors will pay close attention to the European Central Bank (ECB) monetary policy announcement on Thursday, in which policymakers are expected to leave policy rates steady. In the June policy meeting, officials raised key rates by 25 basis points (bps), but guided a meeting-by-meeting approach.

Latest remarks from ECB officials signaled that more interest rate hikes could be needed as price pressures will likely stay above the central bank’s 2% target for longer.

EUR/USD technical analysis

EUR/USD trades slightly lower at around 1.1437, holding a mildly bearish near-term tone as it remains just under the 20-period Exponential Moving Average (EMA) at 1.1441, which now caps the upside. The price action suggests a Bearish Flag formation, which is a trend-continuation pattern. As price action suggests that the prior move was on the downside before a consolidation, the odds of further decline are significantly higher.

The Relative Strength Index (RSI) at about 47 leans slightly soft and hints that upside momentum is waning while the pair trades beneath its immediate dynamic resistance.

On the topside, initial resistance is located at the 20-day EMA around 1.1441, and a sustained break above this cap would expose the channel top near 1.1516 as the next hurdle. On the downside, the lower boundary of the rising channel at 1.1393 is the first notable support, and a decisive drop through this floor would weaken the constructive channel structure and open the door for further decline towards 1.1300.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

ECB FAQs The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy for the region. The ECB primary mandate is to maintain price stability, which means keeping inflation at around 2%. Its primary tool for achieving this is by raising or lowering interest rates. Relatively high interest rates will usually result in a stronger Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.

In extreme situations, the European Central Bank can enact a policy tool called Quantitative Easing. QE is the process by which the ECB prints Euros and uses them to buy assets – usually government or corporate bonds – from banks and other financial institutions. QE usually results in a weaker Euro. QE is a last resort when simply lowering interest rates is unlikely to achieve the objective of price stability. The ECB used it during the Great Financial Crisis in 2009-11, in 2015 when inflation remained stubbornly low, as well as during the covid pandemic.

Quantitative tightening (QT) is the reverse of QE. It is undertaken after QE when an economic recovery is underway and inflation starts rising. Whilst in QE the European Central Bank (ECB) purchases government and corporate bonds from financial institutions to provide them with liquidity, in QT the ECB stops buying more bonds, and stops reinvesting the principal maturing on the bonds it already holds. It is usually positive (or bullish) for the Euro.

Dollar Index Price Chart – Source: Tradingview The US dollar trades near 100.75 on the 4-hour chart following a relief from near 100.35 last week. Price has a clear trendline overhead that caps the move, plus price trades near and below 50-EMA (100.84) & 100-EMA (100.84), so the overall near-term move seems still under pressure despite the recent relief.

The first resistance is at 100.89, which is the trendline and at the 61.8% retracement level. If price can sustain a move past 100.89, the target will be 101.03, then 101.22, and 101.46. The nearest support is at 100.69. Further support will be near 100.61, 100.51, then the recent support near 100.35. The RSI is at about 49 and it indicates that the market momentum is balanced at current price as the buyers and sellers are having equal strength at this time.

For now, my view is that DXY is consolidating beneath the resistance and trendline. If price can get above the trendline, then the chance of broader recovery will get more favorable. If sellers push price away from current level, then there will be higher chance of seeing another test of 100.61 and 100.35 support.

GBP/USD Technical Analysis: Bullish Structure Above The Rising Trendline

Summary:

EUR/USD traded near 1.1440 after recovering from recent lows, supported by expectations that the European Central Bank could raise interest rates again in September. The euro’s advance remains limited as escalating US-Iran tensions and oil prices above $90 increase safe-haven demand for the US dollar. EUR/USD must clear the 1.1470–1.1500 resistance zone to strengthen its recovery, while 1.1400 remains the first major support level. The EUR/USD exchange rate held near 1.1440 on Monday as traders weighed the prospect of another European Central Bank interest rate increase against renewed demand for the US dollar amid escalating tensions between Washington and Tehran.

The currency pair was trading around 1.1437 at the time of writing, having pulled back from last week’s high near 1.1480. The euro remains supported by expectations that the ECB will retain a hawkish bias at this week’s policy meeting, even though policymakers are widely expected to leave borrowing costs unchanged.

However, the dollar has regained some ground as the US-Iran conflict intensifies and disruption to oil shipments through the Strait of Hormuz pushes energy prices higher. Brent crude rose above $90 a barrel, reviving inflation concerns and strengthening the case for the Federal Reserve to maintain higher interest rates.

Why Is EUR/USD Rising Today? The euro has found modest support from changing expectations for ECB monetary policy.

The ECB is expected to keep its deposit rate unchanged at 2.25% when officials meet on Thursday. Nevertheless, a Reuters poll found that most economists expect another rate increase later this year, with September emerging as the most likely timing.

That outlook has become more credible following the renewed increase in energy prices. Eurozone inflation eased to 2.8% in June but remains above the ECB’s 2% target, while rising oil and gas costs threaten to create another wave of price pressure.

Consequently, the euro has retained support even as the ECB prepares to pause after its previous rate increase. Traders will pay close attention to President Christine Lagarde’s comments for any indication that September remains a live option.

Will the ECB Raise Interest Rates in September? A September rate increase is increasingly becoming the central question for the EUR/USD forecast.

Around 70% of economists surveyed by Reuters expect the ECB to raise rates once more before the end of 2026. However, policymakers must balance renewed inflation risks against a weak eurozone economy, which expanded by only 0.2% during the latest quarter.

The ECB’s challenge is that higher energy prices can simultaneously lift inflation and weaken economic activity. Businesses face higher operating costs, while households have less disposable income available for other goods and services.

A clearly hawkish message from Lagarde could help EUR/USD challenge 1.1500. Conversely, a more cautious tone that emphasises weak growth could encourage traders to reduce expectations for a September move and weigh on the euro.

How Are US-Iran Tensions Affecting EUR/USD? Escalating hostilities between the United States and Iran are preventing a stronger euro recovery.

The United States carried out a ninth consecutive night of strikes, while Iran warned that the Strait of Hormuz would remain unsafe for oil, gas and petrochemical shipments. Ship traffic through the strategically important waterway has declined sharply, contributing to Brent crude’s move above $90 and WTI’s rise beyond $84.

The development creates two headwinds for EUR/USD.

First, geopolitical uncertainty increases demand for the US dollar as investors move toward highly liquid safe-haven assets. Second, Europe is particularly exposed to imported energy costs, meaning a sustained oil shock could weaken the eurozone growth outlook even while forcing the ECB to keep monetary policy restrictive. The dollar has therefore remained resilient despite recent evidence that US inflation had begun to moderate. Markets are also pricing an increased possibility of another Federal Reserve rate rise before the end of the year.

EUR/USD Technical Analysis: Can the Euro Break Above 1.1500? The one-hour chart shows EUR/USD consolidating near 1.1437 after its retreat from the 1.1480 area. Price is hovering around the middle Bollinger Band near 1.1436, indicating that neither buyers nor sellers currently have firm control.

The Moving Average Convergence Divergence indicator is beginning to stabilise after turning negative during the latest pullback. However, momentum remains limited, suggesting that the pair may continue trading sideways unless a fresh fundamental catalyst emerges.

Immediate resistance is located between 1.1445 and 1.1470, where the upper Bollinger Band and recent intraday highs are concentrated. A sustained move above 1.1470 would expose the psychologically important 1.1500 level.

A close above 1.1500 would improve the short-term structure and could open a move toward 1.1580 and 1.1620.

On the downside, 1.1425 provides initial support near the lower Bollinger Band. The more important level is 1.1400, which has repeatedly attracted buyers. A decisive break beneath 1.1400 would weaken the recovery and bring 1.1375 back into focus, followed by 1.1320.

EUR/USD Outlook Ahead of the ECB Rate Decision The immediate EUR/USD outlook hinges on whether the ECB validates market expectations for another rate increase in September.

A hawkish policy statement could help the euro test 1.1470 and 1.1500, particularly if Lagarde signals that higher energy prices pose a material threat to inflation. However, the dollar is likely to remain supported while the US-Iran conflict disrupts energy markets and drives investors toward safety.

For now, EUR/USD appears caught between a more hawkish ECB outlook and a stronger geopolitical bid for the dollar. That leaves the pair vulnerable to further consolidation until Thursday’s ECB decision provides a clearer policy signal.

Why is EUR/USD rising today?

EUR/USD is finding support as investors expect the European Central Bank to retain a hawkish stance and potentially raise interest rates again in September. However, gains remain limited by safe-haven demand for the US dollar.

How will the ECB interest rate decision affect EUR/USD?

A hawkish ECB decision would likely support the euro by strengthening expectations for higher interest rates. A cautious statement focused on weak economic growth could weigh on EUR/USD and bring the 1.1400 support level back into focus.

The EUR/USD pair trades in positive territory around 1.1445 during the early European trading hours on Monday, bolstered by a hawkish tone from the European Central Bank (ECB). The ECB is expected to hold interest rates on ThThursday butill hike for the second time this year in September as a renewed energy price surge raises the risk of more intense inflation pressures, according to Reuters.

However, escalating tensions in the Middle East could boost safe-haven flows, supporting the US Dollar (USD) against the Euro (EUR). Bloomberg reported that the US has launched the ninth night of Iran strikes, with Washington saying that airstrikes on Sunday aimed to "punish" Iran over the first US military deaths since renewed hostilities with the Islamic Republic began. 

Iran's Islamic Revolutionary Guard Corps (IRGC) said that the Strait of Hormuz will not be safe for petrochemical products or 'single drop of oil and gas' transit as long as US actions in the region continue.

In the daily chart, EUR/USD keeps a bearish near-term tone as it holds beneath the 100-day Simple Moving Average (SMA). Price sits just under the upper Bollinger Band near, hinting that the latest bounce is running into overhead supply, while the middle Bollinger Band offers nearby dynamic support. The Relative Strength Index (14) at roughly 48 remains below the neutral 50 line, suggesting only modest upside momentum and reinforcing the idea of a capped recovery while the pair trades under its longer-term average.

On the topside, immediate resistance is located at the upper Bollinger Band around 1.1470, with a stronger barrier higher up at the 100-day SMA near 1.1585, where selling interest is likely to re-emerge if tested. On the downside, initial support is seen at the middle Bollinger Band around 1.1415, followed by the lower Bollinger Band near 1.1358; a clear break below this lower band would open the door to a continuation of the broader decline.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Euro FAQs The Euro is the currency for the 20 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).

The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.

Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.

Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.

Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.

Key Points:Strong credit growth and higher energy prices may keep inflation risks elevated and delay any dovish shift from the Fed.The US Dollar Index could extend its short-term rise if rate hike expectations remain firm.EURUSD may stay under pressure and could move toward 1.12 if key support levels fail.

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The US interest rate outlook remains uncertain despite the softer inflation report for June. Strong credit growth and rising energy prices could keep inflation risks elevated and the Fed hawkish. The central bank may keep rates unchanged in the near term and use other tools to limit the liquidity. This cautious policy outlook could support the US dollar index in the short term while keeping EURUSD under pressure.

Credit Growth Raises US Inflation and Fed Rate Risks Credit Growth Points to Longer-Term Inflation Risks The drop in US CPI in June does not eliminate the broader inflation risk. Consumer price data is volatile and can change monthly due to the instability of energy prices. Inflation may again turn positive in the near future due to the recent increase in oil and fuel prices. This makes it difficult for Fed to view pricing pressures as under control based on one soft inflation report.

Credit growth gives a better picture of the long term inflation risks. The 12-month change in domestic debt was 5.7% as compared to the 2.7% increase in real GDP over the same period. This 3% gap indicates that the credit grew at a higher rate than the real economy. This implies that the additional borrowing could be a source of persistent inflationary pressure if the increase in spending is not matched by an increase in output of goods and services.

The inflation may be growing beneath the surface in the second quarter. Bank credit growth picked up to 7.4% for the 12 months ending in June before a drop to 7.0%. But the real GDP growth was at 2.7%. This means that the credit was growing 4.7 percentage point faster than the real output. This would make it more difficult for the Fed to get inflation down to the 2% target, despite more stable energy prices.

The chart below shows the historical data for credit growth and real GDP. It is found that bank credit has often grown faster than the economy. This does not always lead to higher inflation but it can raise inflation risks when extra borrowing increases spending faster than the production.

Fed May Keep Rates Steady for Now Federal Reserve Vice Chair Philip Jefferson said that the current policy rate is suitable for the time being. He also said that the Fed may have to change its stance if inflationary pressure does not cool down soon. That means the Fed may not hike rates at its July 28-29 meeting but will leave the door open. Higher energy prices, tariff impacts and higher demand associated with AI investments may make a case for tighter policy later.

Fed Could Tighten Liquidity Without Raising Its Main Rate Chair Kevin Warsh may also prefer to keep rates unchanged over the coming months while he assesses inflation, economic growth and the effects of earlier policy decisions. This means that the Fed could resort to other policy measures to reduce credit growth without raising its primary rate.

One possibility would be to shrink the Fed’s balance sheet. The central bank could allow more Treasury securities to mature without replacing them. It may also be able to reverse some of the $200 billion that it added to its balance sheet since December. This would drain liquidity out of the financial system and reduce the reserves of commercial banks.

But there would be significant risks if the balance sheets were reduced aggressively. Bank reserves might drop below US$3 trillion and stress short term funding markets.

This issue took the form of a spike in the Repo rates in 2019 which necessitated the Fed to alter its course. Hedge funds also hold large leveraged Treasury positions funded through the repo market. A sharp increase in repo rates could force them to sell bonds and increase volatility in Treasury market.

The Fed’s reverse repo balance is now almost back to zero. The Fed might offer a higher rate in order to draw some cash back from money market funds. This may reduce liquidity in private markets. But the effect could be small as facility now holds very little money.

US Dollar Index Forecast: Fed Rate Risks Support the Dollar Fed Policy and Inflation Risks Support the US Dollar The US Dollar Index could still find some support in the short term as investors are looking for the Fed to maintain its restrictive policy stance. The prospect of a future rate hike could also drive Treasury yields and demand for the dollar. Meanwhile, markets will likely continue to graze on the notion that the higher interest rates could persist for longer as U.S. credit growth strengthened and energy inflation increased.

But the long term outlook for the dollar is less positive if the Fed hikes yields to protect the Treasury market. In the first quarter, nominal GDP expanded at an annual rate of 6.1%. This is well above the 10-year Treasury yield. If the bond yield is lower than nominal growth, it could result in negative interest rates. This may make the dollar less valuable and force investors to turn to gold, stocks and other tangible assets.

US Dollar Index Technical Outlook Points to 104 The weekly chart for the US dollar index shows that the index broke the key 100.50 level in June 2026 and triggered a rally to a high of 101.80. After encountering short-term resistance at 101.80, the US dollar Index corrected back toward the 100.50 level last week and marked a low.

The formation of a rounding bottom since June 2025 and the breakout above 100.50 indicate that the short-term direction for the US dollar is higher. A break above 101.80 may push the US dollar Index toward 104 in the short term.

But a break above the 104 level may push the index toward the 106–107 zone, which is the overall resistance marked by the descending trendline extending from the October 2022 highs. But the overall long term trend for the US dollar Index remains bearish.

The importance of the current support zone is also seen on the monthly chart which shows that June closed above the key resistance level of 100.50. This suggests that a break above June highs may push the index toward the resistance levels of 104 and 106 in the short term.

But a break below the 96 level may break the ascending channel pattern and push the index toward the 90 level.

EURUSD Forecast: Fed and ECB Policies Drive the Next Move Fed and ECB Rate Outlook Keeps EURUSD Under Pressure EURUSD may remain under pressure in the near term as the ECB expects to hold rates on July 23 and the Fed continues to signal a hawkish stance on rate hikes in September.

Eurozone inflation slowed to 2.8% in June, but still remains above the ECB’s 2% target rate. The chances of an imminent rate hike could be low due to weak economic growth, but rising oil, gas and electricity prices could keep eurozone inflation prospects high.

The pair could recover from the grounds if the ECB hikes rates in September, while the Fed holds. The latest surge in energy prices has led markets to factor in two more rate hikes by the ECB this year. The ECB would have to deliver a more robust policy response to move the eurozone closer towards the U.S. interest rate. But if eurozone growth is weak, EURUSD may struggle to rally significantly.

EURUSD Technical Outlook Points to 1.12 Support The strong rally in the US dollar index since January 2026 has pushed EURUSD down toward support at 1.1375. EURUSD has been consolidating around this support level since the June 2026 lows and is looking for its next direction.

If EURUSD breaks below this support level, it may put further pressure on the pair and push it toward 1.1260. The 1.1260 level remains the key support, defined by support line of the broadening wedge pattern. This support line extends from the May 2025 low.

The EURUSD direction remains bullish in the long term as the US dollar Index remains bearish. A break below 96 in the US dollar Index will likely push EURUSD higher in the long term.

The importance of the current support zone in EURUSD is also highlighted on the daily chart. The chart shows that 1.1360 to 1.1470 remains the critical support zone where the pair is currently consolidating. The 50-day and 200-day SMAs also remain in negative territory.

But the RSI has rebounded from oversold levels and moved toward the midpoint. This indicates that a break below 1.1350 may push EURUSD further down to the 1.12 zone.

Bottom Line Credit growth and higher energy prices may keep US inflation risks elevated in the short term. The Fed may leave rates unchanged in the near term but it is unlikely to turn dovish while the inflation risks persist. It may instead use its balance sheet or other liquidity tools to slow credit growth. But the Fed must avoid tightening too quickly because stress in funding markets could raise bond volatility.

The US Dollar Index may stay strong above 100.50 and could test 101.80 and 104 if rate expectations remain high. EURUSD may remain weak as long as it remains below the 1.1645. A break below 1.1320 could push the pair toward 1.12. But the long term outlook for EURUSD may improve if the dollar breaks the long term support of the 96 level.

Read more: BOJ Rate Hike Risk Builds as USDJPY Eyes 175

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Muhammad Umair is a finance MBA and engineering PhD. As a seasoned financial analyst specializing in currencies and precious metals, he combines his multidisciplinary academic background to deliver a data-driven, contrarian perspective. As founder of Gold Predictors, he leads a team providing advanced market analytics, quantitative research, and refined precious metals trading strategies.

Editors’ Picks

The Euro to Dollar (EUR/USD) exchange rate is trading around 1.1440 after recovering from June lows near 1.1325, but Goldman Sachs believes options markets are signalling renewed downside risks for the pair.

EUR/USD has remained relatively stable through July, gaining around 0.3% so far this month after falling more than 2% in June.

Goldman Sachs highlights developments in the options market, particularly swaptions, as a warning that investors may be preparing for greater downside exposure in the Euro-Dollar pair.

The bank argues that while EUR/USD has been supported by a period of Dollar weakness and reduced expectations for aggressive Federal Reserve tightening, the balance of risks has become less favourable for the Euro.

A key concern is that markets may have become too comfortable with the recent range-bound environment. Renewed volatility, changes in interest-rate expectations or a return of Dollar demand could quickly challenge EUR/USD support.

Goldman Sachs continues to monitor the interaction between rates markets and currency positioning, with options pricing suggesting investors are increasingly willing to protect against a move lower.

The Euro also faces challenges from the broader macro backdrop. While expectations for further European Central Bank tightening have provided some support, growth concerns and energy-related risks remain potential headwinds.

With EUR/USD currently holding close to the 1.14 area, Goldman Sachs sees the options market as highlighting the possibility that the next significant move could be lower rather than a continuation of the recent recovery.

Key Points:GBP/USD remains under pressure as pullback continues. USD/CAD attempts to settle below the support at 1.4010 - 1.4025.USD/JPY remains stuck near the 162.50 level.

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U.S. Dollar Continues To Rebound As Traders Focus On Consumer Sentiment Data

DXY 170726 4h Chart U.S. Dollar Index gains ground as traders focus on the better-than-expected Michigan Consumer Sentiment report. The report indicated that Michigan Consumer Sentiment increased from 49.5 in June to 54.4 in July, compared to analyst forecast of 51.

Today, traders also had a chance to take a look at housing market data. Housing Starts increased by +19% month-over-month in June, compared to analyst forecast of 0%. Building Permits decreased by -3%, while analysts expected that they would drop by -0.7%.

U.S. Dollar Index settled above the support at 100.50 – 100.65 and is moving towards the 50 MA at 100.90. In case U.S. Dollar Index manages to settle above the 50 MA, it will move towards the resistance level at 101.15 – 101.30.

EUR/USD Is Mostly Flat Ahead Of The Weekend EUR/USD 170726 4h Chart EUR/USD is stuck near the support level at 1.1420 – 1.1435 as traders focus on U.S. economic data. Industrial Production increased by +0.1% month-over-month in June, compared to analyst consensus of +0.2%.

In case EUR/USD manages to settle below the 1.1420 level, it will head towards the next support, which is located in the 1.1350 – 1.1365 range. On the upside, a move above the 1.1450 level will push EUR/USD towards the resistance at 1.1500 – 1.1515.

GBP/USD Remains Under Pressure GBP/USD 170726 4h Chart GBP/USD tested new lows as pullback continued. Traders focused on the rally in the oil markets, which was triggered by rising tensions in the Middle East.

If GBP/USD stays below the 1.3450 level, it will head towards the 50 MA at 1.3413. A move below the 50 MA will open the way to the test of the support level at 1.3335 – 1.3350. RSI remains in the moderate territory, so there is plenty of room to gain momentum in the near term.

On the upside, a successful test of the resistance at 1.3450 – 1.3465 will open the way to the test of the next resistance level at 1.3535 – 1.3550.

USD/CAD Tests Support At 1.4010 – 1.4025

USD/CAD 170726 4h Chart USD/CAD is losing ground as traders focus on rising gold and silver prices. Other commodity-related currencies are mixed in today’s trading session. There are no important economic reports scheduled to be released in Canada today, so traders will stay focused on general market sentiment.

USD/CAD continues its attempts to settle below the support at 1.4010 – 1.4025. If USD/CAD manages to settle below the 1.4010 level, it will head towards the next support, which is located in the 1.3915 – 1.3930. RSI has moved back into moderate territory, but there is some room to gain additional downside momentum in the near term.

USD/JPY Stays Close To Multi-Decade Highs USD/JPY 170726 4h Chart USD/JPY remains stuck near the 162.50 level as traders focus on dynamics of Treasury yields. The yield of 2-year Treasuries climbed above the 4.16% level, while the yield of 10-year Treasuries settled below 4.55%.

Traders are cautious amid worries about potential interventions from the Bank of Japan. However, BoJ’s interventions failed to provide support to the yen in 2026. In case USD/JPY manages to settle above the 162.80 level, it will gain additional upside momentum and head towards the 165.00 level.

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Vladimir is an independent trader, with over 18 years of experience in the financial markets. His expertise spans a wide range of instruments like stocks, futures, forex, indices, and commodities, forecasting both long-term and short-term market movements.

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The EUR/USD forecast remains biased to the downside as geopolitical tensions in the Middle East continue to underpin demand for both crude oil and the US dollar. Although this week’s softer US inflation readings briefly encouraged hopes that the Fed may not have to tightening after all, the renewed rise in oil prices has complicated that narrative and prompted investors to reassess the outlook. As such, they have found it difficult to justify shorting higher-yielding currencies or buying low or zero yielding assets. This narrative is unlikely to change much until there is genuine breakthrough in the tension between the US and Iran.

Dollar remains on front-foot as oil risk clouds inflation outlook This week we had some weak inflation numbers from the US, and that caused only temporary weakness in US dollar. Both consumer and producer inflation surprised on the downside, reinforcing the view that underlying price pressures are gradually easing. Under normal circumstances, that would have weighed on the greenback more meaningfully. Instead, markets have been reluctant to fully embrace that view as crude oil prices continue to climb amid escalating tensions between the United States and Iran.

Higher energy prices raise the risk that inflation proves more persistent later in the year, potentially delaying any shift towards easier monetary policy. While investors still expect inflation to moderate over the medium term, the near-term backdrop has become considerably less favourable for dollar bears. I continue to believe that a stronger dollar is the more likely outcome in so far as the near-term is concerned, assuming geopolitical risks do not fade abruptly, and energy prices retreat. That makes the near-term EUR/USD forecast slightly bearish.

Fed policymakers remain reluctant to soften their stance Despite encouraging inflation data, Federal Reserve officials have made little effort to signal an imminent policy pivot. Chair Kevin Warsh and Governor Chris Waller both reiterated that one or two favourable inflation reports are insufficient evidence that price stability has been restored. With crude oil prices moving sharply higher, policymakers will be wary of declaring victory too early. Energy costs rising means the Fed is unlikely to abandon its cautious approach until it sees sustained evidence that inflation is returning towards target. Markets continue to price in one rate increase before year-end. Should expectations shift towards a more aggressive policy path, the dollar could extend its recent gains while risk assets may struggle to maintain their resilience.

ECB meeting could provide the next catalyst For the euro, attention now turns to next week’s European Central Bank meeting. Although policymakers are widely expected to leave interest rates unchanged, rising energy prices have injected a degree of uncertainty into the outlook. The ECB faces an uncomfortable balancing act. On one hand, inflation has continued to moderate across much of the eurozone. On the other, higher oil prices threaten to revive inflationary pressures while simultaneously weighing on economic growth, raising the spectre of stagflation.

Some policymakers may therefore argue for maintaining a hawkish bias to preserve the ECB’s inflation-fighting credibility. Investors will be paying close attention to President Lagarde’s guidance for clues on whether policymakers are becoming more concerned about renewed energy-driven inflation.

Beyond the ECB, next week’s flash PMI surveys will offer a timely snapshot of business activity across the major economies and could shape expectations for both European growth and the direction of the euro over the coming weeks.

Technical EUR/USD forecast: Key levels to watch The EUR/USD managed to find support from the support trend of its flag pattern near the 1.1380 area earlier this week. That led to a bounce to test resistance and the bearish trend line around 1.1475/80 zone. From there, we have since seen renewed weakness. As a result, the EUR/USD continues to remain inside its bear flag pattern, and below the bearish trend line. While momentum is clearly lacking, the overall technical bias is one that leans slightly on the bearish side of things. The onus is on the bulls to show up and change that trend. Until that happens, the near-term EUR/USD forecast from a technical analysis point of view remains to the downside.

Source: TradingView.com Should the EUR/USD break below the bear flag, then the next target would be the 1.1300 handle. Conversely, a break above the short-term bearish trend could expose the 1.1500 handle for a retest with the next resistance not seen until 1.1575 – 1.1600 area.

-- Written by Fawad Razaqzada, Market Analyst

Follow Fawad on Twitter @Trader_F_R

The Euro (EUR) trades flat against the US Dollar (USD) at around 1.1445 during the European trading session on Friday. The EUR/USD pair is expected to trade with caution amid continued military aggression between the United States (US) and Iran.

In the European trade, the US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, trades flat around 101.70.

Earlier in the day, Iran asked Yemen’s Houthi militia to stand ready to close the Red Sea oil route if the US strikes Iranian power infrastructure, Reuters reports.

The threat from Iran is a response to remarks from US President Donald Trump, in an interview with Fox News, in which he said that military forces would be authorized to attack Iranian bridges and power plants if the nation doesn’t come to the table for negotiations.

A further disruption in the global energy supply would squeeze the already-low global oil supply, which could further accelerate fears of high inflation globally.

On the monetary policy front, the European Central Bank is expected to deliver more interest rate hikes amid fears of second-round inflation effects in the Eurozone.

ECB Governing Council Member and President of the Deutsche Bundesbank, Joachim Nagel, said earlier this week that the central bank remains vigilant to Middle East developments, while warning that policymakers will act decisively if necessary.

Nagel keeps ECB vigilant but tempers hawkish edge for the EuroECB's Nagel scores 6.4/10 on FXS Speechtracker, below the historic 7.2/10 baseline, signaling a slightly softer tone versus past communications. The emphasis on reacting "with caution" but "decisively if necessary" points to a moderately hawkish stance, yet less forceful than usual, suggesting the Euro may see limited upside unless data re-energizes policy conviction.

The pledge that monetary policy will "maintain its vigilant stance" reinforces a readiness to tighten or resist premature easing, supporting the Euro against more dovish expectations. However, the reference to recent geopolitical "hopes and disappointments" introduces uncertainty, implying that while vigilance remains, conviction is constrained, which caps the hawkish impact reflected in the lower FXS Speechtracker score.

Key Points:Strong U.S. retail sales and resilient jobless claims reinforced expectations that the Fed will keep rates higher for longer.DXY remains below trendline resistance, with a break above 100.77 needed to revive near-term bullish momentum.EUR/USD continues consolidating beneath key resistance while holding above both major moving averages.GBP/USD remains in a broader uptrend as buyers defend trendline support despite the recent pullback.

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US Dollar News: Strong Data Reinforces Fed’s Cautious Stance The U.S. Dollar’s technical profile is underpinned by better than expected data which highlighted steady retail sales and a strong jobs market. June retail sales saw 0.2% month on month growth while the control group rose 0.4%, both indicating underlying resilience in consumer demand. Initial jobless claims came in at 221,000 which highlighted a strong labour market. The data has tempered expectations that the Fed will start cutting rates this year as retail sales and unemployment remain relatively strong even though overall growth has slowed.

Meanwhile, The Euro’s outlook is weighed down by slowing growth prospects in the eurozone with the ECB keeping rates stable at its 2.25% deposit rate, according to futures.

Sterling has also found support following the central bank’s hawkish policy stance after UK inflation remains too high. The consensus is that policymakers will be holding the Bank Rate at 3.75%. This view is consistent with persistent price pressures as well as some easing in the labor market, both before the next rate decision.

US Dollar Technical Analysis: DXY Rejected Below Trendline as Bears Defend 100.77 Dollar Index Price Chart – Source: Tradingview The US Dollar Index (DXY) is at 100.69, after another test off the descending trendline at 100.77 resistance. DXY remains below 100.79 (50 EMA) and 100.87 (100 EMA) and the trendline which has been a source of repeated tests, confirming the short term bearish bias.

The 100.61 support level is followed by 100.52 and 100.35 while 100.77 resistance is followed by 101.03.RSI has dropped to ~47, indicating a potential slowdown in buyer momentum and a neutral-bearish tone overall. I’ll wait for the market to trade through 100.77 on my way to 101.03, with 100.61 being an important key level to flip if traded through.

GBP/USD Technical Analysis: Pullback Holds Above Trendline as Uptrend Remains Intact GBP/USD Price Chart – Source: Tradingview GBP/USD is near 1.3472 after a retreat from last week’s highs around 1.3559. Buyers are defending the trendline, as GBP/USD remains above the 50 EMA at 1.3449 and the 100 EMA at 1.3415. The price remains bullish despite a short term decline since higher highs and higher lows are intact on a larger picture.

GBP/USD faces 1.3507 resistance, with 1.3560 resistance ahead of that. Price is supported by 1.3449, which is followed by 1.3340 support. The RSI cooled to ~51, indicating that the correction has likely been a short term dip rather than a trend reversal. I’ll look to trade a breakout through 1.3507 on my way to 1.3560, with a drop below 1.3449 likely targeting 1.3340.

EUR/USD Technical Analysis: Bulls Hold Above 50 EMA While Testing Key Resistance EUR/USD Price Chart – Source: Tradingview The Euro is at 1.1450, consolidating below the 1.1461 resistance level after extending its rally in the previous sessions. The 1.1437 (50 EMA) and 1.1431 (100 EMA) levels are still supporting price action and the market remains bullish despite being turned down by overhead resistance.

The trend structure resembles a tightening symmetrical triangle with 1.1412 support at 1.1379. The 1.1461 resistance is followed by 1.1493.

The RSI is hovering around ~54, indicating a low degree of bullish momentum with room before entering overbought territory. I’ll wait for confirmation of a 1.1461 breach on my way to 1.1493, with a breakdown at 1.1412 likely sending price back toward 1.1379.

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Arslan is a finance MBA and also holds an MPhil degree in behavioral finance. An expert in financial analysis and investor psychology, Arslan uses his academic background to bring valuable insights about market sentiment and whether instruments are likely to be overbought or oversold.

Editors’ Picks

The EUR/USD pair ticks lower for the second straight day on Friday as energy-driven inflation fears revive US Federal Reserve (Fed) rate hike bets and support the US Dollar (USD) amid escalating US-Iran tensions.

Spot prices currently trade around the 1.1435 region, though the lack of follow-through selling warrants caution before positioning for an extension of the pullback from a nearly four-week high, touched on Wednesday.

From a technical perspective, this week's breakout momentum above the 23.6% Fibonacci retracement level of the April-June downfall faltered near the 200-period Simple Moving Average (SMA) on the 4-hour chart.

The Relative Strength Index (RSI) is hovering near a neutral 50, and the Moving Average Convergence Divergence (MACD) is drifting marginally negative. Momentum indicators hint that bullish attempts may remain constrained.

On the downside, the main structural support is located at the Fibonacci anchor near 1.1330, which aligns with the latest swing low and could attract buyers on a deeper pullback.

On the topside, immediate resistance is defined by the 200-period SMA at 1.1477 ahead of the 38.2% retracement at 1.1508. A sustained break above these would open the door toward higher Fibonacci hurdles at 1.1563 and 1.1618, if bullish pressure extends.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Euro FAQs The Euro is the currency for the 20 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).

The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.

Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.

Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.

Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.

EUR/USD trades lower near the 1.1440 area on Thursday, retreating around 0.2% as the US Dollar (USD) gains support from stronger-than-expected United States (US) labor market data.

US Initial Jobless Claims fell to 208K in the week ending July 11, below expectations of 217K and the previous 216K. The figures indicate that layoffs remain limited, supporting the Greenback despite signs of softer consumer spending.

US Retail Sales rose 0.2% MoM in June, matching expectations but slowing from May’s 1.0% increase. The Retail Sales Control Group advanced 0.5%, also in line with forecasts but below the previous 0.8%, suggesting that consumption momentum moderated.

In the Eurozone, investors await June inflation data. Core Harmonized Index of Consumer Prices (HICP) inflation is expected to remain at 2.4% YoY and 0.2% MoM, while headline HICP is forecast to decline 0.1% on the month. A softer inflation reading could strengthen expectations of a less restrictive European Central Bank (ECB) policy stance and place additional pressure on the Euro.

Short-term technical analysis:On the 4-hour chart, EUR/USD trades at 1.1436, maintaining a mildly bullish bias as it holds above both the 20-period Simple Moving Average (SMA) at 1.1428 and the 100-period SMA at 1.1413. The short-term trade is underpinned by these clustered SMA supports, while the Relative Strength Index (RSI) around 50 suggests balanced momentum after the recent recovery earlier in the week, hinting that dips could continue to attract buying interest as long as the pair stays over the moving average floor.

On the topside, initial resistance is located at 1.1447, followed by a tighter band of barriers at 1.1457, 1.1466 and 1.1472, where prior horizontal caps could slow further gains. On the downside, immediate support is seen at the 20-period SMA at 1.1428, with stronger structural demand emerging at the 100-period SMA near 1.1413; a sustained drop below this latter level would weaken the current constructive tone and expose deeper consolidation.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Key Points:GBP/USD pulled back as traders reacted to economic reports from U.S. and UK. USD/CAD made an attempt to settle below the support level at 1.4010 - 1.4025.USD/JPY gained ground amid rising Treasury yields.

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U.S. Dollar Moves Higher As Traders React To Economic Data

DXY 160726 4h Chart U.S. Dollar Index gains ground as traders react to the Retail Sales report. The report indicated that Retail Sales increased by +0.2% month-over-month in June, in line with analyst estimates. Retail Sales Ex Autos declined by -0.2%, compared to analyst forecast of -0.1%.

Today, traders also had a chance to take a look at the Initial Jobless Claims report. The report indicated that 208,000 Americans filed for unemployment benefits in a week, compared to analyst consensus of 217.000. The report showed that labor market remained in decent shape, which was bullish for the U.S. dollar.

NAHB Housing Market Index decreased from 36 (revised from 35) in June to 34 in July, compared to analyst forecast of 35.

U.S. Dollar Index climbed above the support at 100.50 – 100.65 and is trying to settle above the 100.75 level. In case this attempt is successful, U.S. Dollar Index will head towards the 50 MA at 100.92. A move above the 50 MA will open the way to the test of the resistance at 101.15 – 101.30.

EUR/USD Retreats As Traders Take Profits After Recent Rebound EUR/USD 160726 4h Chart EUR/USD pulls back as traders focus on economic reports from the U.S. Pending Home Sales declined by -5.4% month-over-month in June, compared to analyst forecast of -0.5%.

The nearest support level for EUR/USD is located in the 1.1420 – 1.1435 range. A successful test of this level will open the way to the test of the next support, which is located in the 1.1350 – 1.1365 range.

GBP/USD Pulls Back As UK Industrial Production Misses Estimates GBP/USD 160726 4h Chart GBP/USD is losing ground as traders focus on UK GDP report. The report showed that UK GDP increased by +0.1% month-over-month in May, in line with analyst consensus.

Manufacturing Production increased by +0.1% month-over-month in May, compared to analyst forecast of -0.2%. Industrial Production decreased by -0.5%, while analysts expected that it would drop by -0.1%.

In case GBP/USD manages to settle below the support level at 1.3450 – 1.3465, it will head towards the 50 MA at 1.3400. A move below the 50 MA will open the way to the test of the next support level at 1.3335 – 1.3350.

USD/CAD Tests Support At 1.4010 – 1.4025 USD/CAD 160726 4h Chart USD/CAD is mostly flat despite the strong pullback in precious metals markets. Gold declined below the psychologically important $4000 level, while silver tested strong support at $56.00. Other commodity-related currencies are losing some ground in today’s trading session.

Currently, USD/CAD is trying to settle below the support at 1.4010 – 1.4025. In case USD/CAD settles below the 1.4010 level, it will move towards the next support level at 1.3915 – 1.3930. RSI is close to the oversold territory, but there is enough room to gain additional downside momentum in the near term.

USD/JPY Gains Ground As Treasury Yields Rebound USD/JPY 160726 4h Chart USD/JPY is moving higher as traders react to the rebound in Treasury yields. The yield of 2-year Treasuries moved above the 4.17% level, while the yield of 10-year Treasuries climbed above 4.58%.

USD/JPY is moving towards multi-decade highs near the 162.80 level. In case USD/JPY manages to settle above 162.80, it will gain additional upside momentum and head towards the 165.00 level.

If you’d like to know more about how to trade forex, please visit our educational area.

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Vladimir is an independent trader, with over 18 years of experience in the financial markets. His expertise spans a wide range of instruments like stocks, futures, forex, indices, and commodities, forecasting both long-term and short-term market movements.

EUR/USD trades with a downside bias on Thursday, snapping a two-day winning streak as the US Dollar (USD) steadies following recent losses driven by softer-than-expected United States (US) inflation data. At the time of writing, the pair trades around 1.1457, down modestly on the day.

Market sentiment remains fragile as renewed tensions in the Middle East push Oil prices higher, raising concerns that June's inflation slowdown may prove short-lived. This is limiting the downside in the US Dollar as traders continue to expect a Federal Reserve (Fed) interest rate hike later this year.

The US Dollar Index (DXY), which tracks the Greenback's value against a basket of six major currencies, is trading around 100.60 after falling to 100.35 on Wednesday, its lowest level since June 18.

The Greenback found additional support after the latest US labour market data showed that Initial Jobless Claims fell to 208K in the week ending July 11. The reading was below the 217K forecast.

US Retail Sales rose 0.2% MoM in June, in-line with expectations. May's reading was slightly revised upward to 1.0% from 0.9%. The Retail Sales Control Group also came in as expected at 0.5%, down from May's 0.8% increase.

On the geopolitical front, the US carried out a fifth consecutive night of strikes against Iranian targets, while Tehran responded by targeting US assets in Kuwait, Bahrain and Jordan.

Reuters reported, citing sources, that Iran had instructed Yemen’s Houthis to close the Bab el-Mandeb gateway to the Red Sea if the US attacks its power network. West Texas Intermediate (WTI) is trading near $80 and gaining around 12% so far this week.

Higher energy prices have also revived expectations of another European Central Bank (ECB) rate hike. A Reuters poll released on Thursday showed that all 74 economists expect the ECB to keep its deposit rate unchanged at 2.25% at its July meeting, while a 70% majority expect one more increase this year, most likely in September.

Euro Price Today The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the Swiss Franc.

USDEURGBPJPYCADAUDNZDCHFUSD0.10%0.21%0.05%-0.18%-0.04%-0.04%0.30%EUR-0.10%0.11%-0.04%-0.27%-0.06%-0.13%0.20%GBP-0.21%-0.11%-0.13%-0.37%-0.18%-0.24%0.11%JPY-0.05%0.04%0.13%-0.25%-0.02%-0.10%0.25%CAD0.18%0.27%0.37%0.25%0.22%0.15%0.49%AUD0.04%0.06%0.18%0.02%-0.22%-0.05%0.28%NZD0.04%0.13%0.24%0.10%-0.15%0.05%0.33%CHF-0.30%-0.20%-0.11%-0.25%-0.49%-0.28%-0.33% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).

The Euro (EUR) trades marginally lower to near 1.1460 against the US Dollar (USD) during the European trading session on Thursday after giving back its early gains. The EUR/USD pair turns upside down as the US Dollar bounces back amid fears that elevated energy prices due to Middle East tensions will keep global inflation projections de-anchored.

At press time, the US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, trades slightly higher to near 100.57.

Crude oil prices are likely to stay higher as the global energy supply is expected to remain disrupted amid fears that the military aggression between the United States (US) and Iran would widen. During the day, an Iranian army spokesperson said that the US continues to attack several areas, while warning that the war will spread to new arenas, the Islamic Republic News Agency (IRNA) reported.

On Wednesday, US President Donald Trump also warned, in an interview with Fox News, that he will authorize bombing Iranian bridges and power plants if Tehran doesn’t return to the table for negotiations.

In the last two trading days, the US Dollar faced selling pressure as traders scaled back Federal Reserve (Fed) interest rate hike expectations due to cooling US inflationary pressures in June.

Going forward, investors will focus on the US Retail Sales data for June, which will be published at 12:30 GMT. The US Retail Sales are estimated to have risen at a moderate pace of 0.2% Month-on-Month (MoM) against 0.9% in May.

Economic Indicator Retail Sales (MoM) The Retail Sales data, released by the US Census Bureau on a monthly basis, measures the value in total receipts of retail and food stores in the United States. Monthly percent changes reflect the rate of changes in such sales. A stratified random sampling method is used to select approximately 4,800 retail and food services firms whose sales are then weighted and benchmarked to represent the complete universe of over three million retail and food services firms across the country. The data is adjusted for seasonal variations as well as holiday and trading-day differences, but not for price changes. Retail Sales data is widely followed as an indicator of consumer spending, which is a major driver of the US economy. Generally, a high reading is seen as bullish for the US Dollar (USD), while a low reading is seen as bearish.

Read more.

Next release: Thu Jul 16, 2026 12:30

Frequency: Monthly

Consensus: 0.2%

Previous: 0.9%

Source: US Census Bureau

Retail Sales data published by the US Census Bureau is a leading indicator that gives important information about consumer spending, which has a significant impact on the GDP. Although strong sales figures are likely to boost the USD, external factors, such as weather conditions, could distort the data and paint a misleading picture. In addition to the headline data, changes in the Retail Sales Control Group could trigger a market reaction as it is used to prepare the estimates of Personal Consumption Expenditures for most goods.

United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann highlight that EUR/USD has broken above prior resistance, with rapid gains seen up to 1.1482. Intraday, the pair is seen capable of testing 1.1490 while staying below significant resistance at 1.1520. Over the next 1–3 weeks, upward momentum is building quickly, with an upside bias as long as 1.1405 strong support holds.

Rapid gains support constructive outlook"24-HOUR VIEW: EUR popped to a high of 1.1462 two days ago before retreating quickly. When EUR was at 1.1425 yesterday, we stated that “the brief rise did not result in any significant increase in momentum,” and we expected it to “trade in a range between 1.1390 and 1.1455.” Our assessments turned out to be incorrect. EUR initially dropped to 1.1405 before rising sharply to 1.1482. While the rapid rise appears to be running ahead of itself, there is scope for EUR to test 1.1490. We do not expect the significant resistance at 1.1520 to come into view. Support is at 1.1450; a breach of 1.1435 would mean that the immediate upward pressure has eased."

"1-3 WEEKS VIEW: Two days ago (14 Jul, spot at 1.1385), we detected a slight increase in downward momentum. However, we pointed out that EUR “must close below 1.1360 before a move to 1.1325 can be expected.” After EUR broke above our ‘strong resistance’ level, we highlighted yesterday (15 Jul, spot at 1.1425) that “the mild downward momentum has eased, and EUR has likely reverted into a range-trading phase, most likely between 1.1390 and 1.1475.” We did not expect EUR to break above 1.1475 so soon as it soared to a high of 1.1482. Upward momentum is building quickly, and from here, as long as 1.1405 (‘strong support’ level) is not breached, EUR is likely to trade with an upside bias. Currently, it is too early to determine whether there is sufficient momentum for EUR to reach the significant resistance level at 1.1520."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Key Points:GBP/USD rallied as traders reacted to U.S. PPI data. USD/CAD moved lower despite the pullback in precious metals markets. USD/JPY was mostly flat as traders ignored falling Treasury yields.

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U.S. Dollar Pulls Back As PPI Misses Estimates

DXY 150726 4h Chart U.S. Dollar Index is moving lower as traders react to Producer Prices report. The report indicated that Producer Prices decreased by -0.3% month-over-month in June, compared to analyst forecast of 0%. Core PPI increased by +0.2%, while analysts forecasted that it would grow by +0.4%.

Today, traders also had a chance to take a look at the NY Empire State Manufacturing Index report. The report showed that NY Empire State Manufacturing Index improved from 5.70 in June to 15.60 in July, compared to analyst consensus of 8.8.

Currently, U.S. Dollar Index is trying to settle below the support level at 100.50 – 100.65. In case this attempt is successful, U.S. Dollar Index will move towards the next support, which is located in the 99.75 – 99.90 range.

EUR/USD Remains Stuck Near The 1.1435 Level EUR/USD 150726 4h Chart EUR/USD is moving higher despite the weaker-than-expected Industrial Production report. The report indicated that Industrial Production decreased by -0.2% month-over-month in May, compared to analyst forecast of +0.2%.

The technical picture remains unchanged as EUR/USD is stuck near the resistance level at 1.1420 – 1.1435. If EUR/USD manages to settle above the 1.1435 level, it will head towards the resistance at 1.1500 – 1.1515.

GBP/USD Tests New Highs GBP/USD 150726 4h Chart GBP/USD rallied as traders reacted to the softer-than-expected U.S. PPI data and remained focused on U.S. CPI report, which was released yesterday.

GBP/USD climbed above the resistance level at 1.3450 – 1.3465 and is trying to settle above the 1.3500 level. In case this attempt is successful, GBP/USD will move towards the next resistance, which is located in the 1.3535 – 1.3550 range. It should be noted that RSI has moved into overbought territory, so the risks of a pullback are increasing.

USD/CAD 150726 4h Chart USD/CAD is moving lower despite the pullback in precious metals markets. Gold declined below the $4050 level, while silver settled below $57.00. Other commodity-related currencies are also moving higher in today’s trading session.

The nearest support level for USD/CAD is located in the 1.4010 – 1.4025 range. A successful test of this level will open the way to the test of the next support at 1.3915 – 1.3930. RSI is in the oversold territory, but there is some room to gain additional downside momentum in the near term.

On the upside, a move above the 1.4080 level will push USD/CAD towards the resistance level at 1.4125 – 1.4140.

USD/JPY Is Flat As Traders Ignore Falling Treasury Yields USD/JPY 150726 4h Chart USD/JPY is mostly flat despite the pullback in Treasury yields. The yield of 2-year Treasuries declined below the 4.15% level, while the yield of 10-year Treasuries settled near 4.55%.

Traders stay bullish due to the ultra-dovish policy of the Bank of Japan. The market believes that BoJ cannot raise rates without putting too much pressure on the Japanese economy.

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Vladimir is an independent trader, with over 18 years of experience in the financial markets. His expertise spans a wide range of instruments like stocks, futures, forex, indices, and commodities, forecasting both long-term and short-term market movements.

EUR/USD Talking Points: After showing strength in early 2026 trade EUR/USD bears took over in May and early-June. The sell-off has since slowed although buyers have yet to make much ground above 1.1469, begging the question as to whether a short squeeze and pullback could bring on bigger picture trend continuation potential. After a strong rally a year ago as markets were getting ready for FOMC rate cuts, EUR/USD has so far spent much of this year grinding, although there has been some short-term trend to work with. In early 2026 trade buyers were making a move, eventually setting a fresh four-year-high in the pair.

But as the Iran conflict took over so too did the fear of European energy vulnerability, and the Euro was hit hard in March to test below the 1.1500 level. A bounce in April was faded in May and June – but so far in July, that move has been stalled and price has been sitting around the 1.1400 handle, begging the question as to which trend will take over next.

EUR/USD Monthly Chart Chart prepared by James Stanley; data derived from Tradingview EUR/USD Next Steps A sell-off stalling can be read as either an impending reversal or a pause in trend. At this point, at least from a relative since with gold and Bitcoin rallying as GBP/USD showing greater strength, I think the bias indicates more of a pause than an impending reversal.

But – with that said, it’s the reaction to a rally and pullback that will illustrate which option is favorable moving forward. I covered this in yesterday’s webinar, as we can still make the claim of lower-lows in the pair from both weekly and monthly charts. But from the daily below we can see where that’s been somewhat messy, although there’s an important message contained in these candles. Sellers have so far responded to pullbacks, holding resistance around 1.1450. But, they’ve also swung less and less weight, illustrated by the higher-lows that have built over the past few weeks.

This indicates an oversold market and one that’s difficult to push for trend-side continuation at this point. It also highlights the possibility of a short-term bullish breakout, which could open the door for bigger picture trend continuation if sellers make a move on follow-through resistance. The 1.1500 area is an ideal spot to look for that to play above current highs, and then there’s a zone of prior support spanning from 1.1576 up to 1.1613 above that that’s of interest.

EUR/USD Daily Chart Chart prepared by James Stanley; data derived from Tradingview EUR/USD: How to Position For Reversal From the above two charts we can see the bearish case fairly well illustrated by the lower-lows and highs that have shown in the pair. While many retail traders will try to trade reversals at the early stage, the fact of the matter is that until bulls show greater demand the forces of trend should be considered as bearish.

For trend traders, this means that they often will not get every pip of every move, and that’s somewhat of the point, as they’re instead trying to focus on probabilities and in this case, the more cogent way of going about the matter would be waiting for price to break above the lower-highs that have so far held, around the 1.1450 area, and then waiting for bulls to stretch up to deeper resistance, whether at 1.1500 or the zone above.

And then the corresponding reaction to that, can then be sought as a higher-low for those looking for the reversal theme. That way, if strength does not pan out, they can, at the least, abandon the trade upon a break to fresh lows.

At this point, we’re just not there yet from the daily chart so until that is the case, I’m looking at rallies in EUR/USD as short-term counter-trend setups.

EUR/USD Four-Hour Chart Chart prepared by James Stanley; data derived from Tradingview --- written by James Stanley, Senior Market Analyst, Global Macro

US Dollar News: Softer Inflation Reshapes Fed Outlook The evolving monetary policies, particularly with the release of June’s inflation numbers in the United States, are causing shifts in the value of the dollar, sterling and the euro. U.S. annual inflation for July fell to 3.5% from June’s 4.2%, with core inflation also falling, to 2.6%. This caused a rapid decrease in the projected likelihood of a July 28-29 Federal Reserve interest rate hike. Demand for U.S. futures implied only a 10% likelihood of a July hike. Earlier estimates placed U.S. interest rate hikes at a 35% probability, indicating the bulk of interest rate conjecture has moved to September.

The euro has risen in value with speculation that the European Central Bank will keep the deposit rate at 2.25% and also Curb inflation and growth in the euro region.

The pound also remains strong as it is expected the Bank of England will continue to err on the side of caution. U.K. inflation has also been little influenced by renewed Middle Eastern conflict. Governor Andrew Bailey remains focused on other economic data.

US Dollar Index Technical Analysis: Is DXY Building Momentum for a Move Toward $101.22? Dollar Index Price Chart – Source: Tradingview The US Dollar Index (DXY) is hovering around the 100.88 mark, consolidating above the 0.50 Fibonacci retracement at $100.59 and the 50 EMA at $100.23. The 100 EMA at $99.66 is helping the uptrend. The last few DXY candlesticks display small bodies showing consolidation below $101.22, right after the bullish breakout from the previous descending triangle. $100.88 is the 0.382 Fibonacci level and is providing immediate support, while resistance sits at $101.22 and $101.79 respectively.

The RSI is at approximately 53, above the midpoint, and is showing a decrease in bullish momentum, but the uptrend is still there. As long as we observe DXY above $100.59, we can expect another attempt to reach $101.22, but if that fails, we may see $99.85.

GBP/USD Technical Analysis: Can the Rising Channel Extend the Rally Above $1.3450? GBP/USD Price Chart – Source: Tradingview GBP/USD is currently trading around 1.3405 and stays well within the confines of a rising channel on the 4 hour time frame. Price is above both the 50 EMA at 1.3370 and the 100 EMA at 1.3340 indicates that traders are still dominating the buying side of the market. Recent rejections of the 1.3400 support level have resulted in the formation of higher lows along the rising channel line. The most immediate resistance is found at 1.3453, while 1.3508 is a secondary resistance level.

The most significant support level is at 1.3342. The RSI is at 56 and indicates a bullish market, while the RSI is not at the overbought zone. Based on this market analysis I will be looking for buying opportunities above the 1.3400 level, the target being 1.3453 and with a break below the 1.3342 level the buy side market structure will be broken and this will be an indication of potential reversal in the market.

EUR/USD Technical Analysis: Will the Symmetrical Triangle Trigger the Next Breakout? EUR/USD Price Chart – Source: Tradingview EUR/USD is priced at 1.1423 and is forming a symmetrical triangle on the 4-H chart. The price is around the 50 EMA at 1.1420 but is below the 100 EMA at 1.1435. This shows that buyers and sellers have not taken control of the market. The latest candlesticks show small bodies and long wicks suggesting indecision as the triangle’s apex is approached.

The first nearby resistance is at 1.1461, and the first nearby support is at 1.1412, then 1.1379. The RSI is at 51 and shows no market pressure, which supports consolidation. Given this analysis, I would prefer to see a confirmed breakout beyond 1.1461 with targets set at 1.1493. However, if the price closed below 1.1412, the target would be 1.1379.