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.
The Euro (EUR) extends gains for the second consecutive day against the US Dollar (USD) on Wednesday, but remains trapped within the trading range seen over the last three weeks, with upside attempts capped below the 1.1470-1.1480 area so far. The Euro has taken advantage of a softer US Dollar, but the risk-off market is keeping bulls in check
The US Dollar took a hit on Tuesday as June’s US Consumer Price Index (CPI) report revealed inflation slowed to a 3.5% year-on-year pace, down from 4.2% in May and well below the consensus of 3.8%. Monthly inflation contracted 0.4%, its weakest reading in nearly six years.
These figures give the Federal Reserve (Fed) some margin to keep interest rates on hold at its July meeting and have prompted investors to dial down expectations of Fed rate hikes in the coming months. The CME FedWatch Tool shows a 60% chance of a hike in September, down from 75% before the CPI release.
Fed Chairman Kevin Warsh showed a distinct hawkish tone at its first congressional testimony, vowing a “resolute commitment to restore price stability” and defending the central bank’s independence from political pressures. His comments, however, failed to lift the US Dollar.
In Europe, the European Central Bank Governor Martin Kocher said earlier on Wednesday that there is no sign of second-round inflationary effects from Iran’s war so far, but that the bank is ready to act if needed.
Meanwhile, the conflict in the Middle East continues to deteriorate. The US has closed the Strait of Hormuz for Iranian vessels, and US President Donald Trump threatened to target civilian infrastructure, like bridges and power plants. Tehran threatened to close other strategic energy routes. Market sentiment remains weak, with Oil prices pinned near monthly highs. All in all not the best scenario for a strong Euro recovery.
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.
United Overseas Bank’s Quek Ser Leang and Lee Sue Ann report EUR/USD briefly spiked to 1.1462 after weaker United States (US) Consumer Price Index (CPI) before retreating to 1.1419. Near term, they see the Euro confined to a 1.1390–1.1455 band, with broader 1-3 weeks expectations of range-trading between 1.1390 and 1.1475. A key medium-term focus is whether the 1.1390/1.1410 support zone holds, as a break would target 1.1210.
Euro-Dollar seen locked in ranges"24-HOUR VIEW: While we highlighted yesterday that “there is a chance for EUR to drop below 1.1360,” we indicated that “a continued drop below this level appears unlikely.” However, EUR only retested the previous day’s low of 1.1377 (low was 1.1376). During the NY session, EUR briefly spiked to a high of 1.1462, retreating quickly to close at 1.1419 (+0.33%). The brief rise did not result in any significant increase in momentum. Today, we expect EUR to trade in a range, most likely between 1.1390 and 1.1455."
"1-3 WEEKS VIEW: We have expected EUR to trade in a 1.1360/1.1450 range since last week. After EUR dropped to a low of 1.1377 two days ago, we highlighted the following yesterday (14 Jul, spot at 1.1385): “The slight increase in downward momentum is insufficient to indicate a sustained decline. EUR must close below 1.1360 before a move to 1.1325 can be expected. The likelihood of EUR closing below 1.1360 will remain intact as long as EUR holds below 1.1445.” EUR subsequently broke above 1.1445 as it briefly rose to 1.1462. The mild downward momentum has eased, and EUR has likely reverted into a range-trading phase, most likely between 1.1390 and 1.1475."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
The EUR/USD pair attracts some dip-buyers following the previous day's pullback from the 1.1460-1.1470 horizontal resistance, though it remains confined within a multi-week-old range. Spot prices trade around the 1.1435-1.1440 region during the Asian session on Wednesday, up for the second straight day amid modest US Dollar (USD) weakness.
Softer-than-expected US consumer inflation data, released on Tuesday, forced traders to scale back their expectations of Federal Reserve (Fed) rate hikes, which keeps the USD bulls depressed and acts as a tailwind for the EUR/USD pair. However, inflation risks stemming from elevated crude oil prices and Fed Chair Kevin Warsh's price stability commitment, along with escalating US-Iran tensions, should limit deeper USD losses and cap the currency pair.
The EUR/USD pair has been struggling to find acceptance and build on its strength beyond the 23.6% Fibonacci retracement level of the April-June downfall. Adding to this, momentum indicators hint at scope for corrective upticks rather than a clear trend reversal. The Moving Average Convergence Divergence (MACD) indicator has turned positive, and the Relative Strength Index (RSI) around 56 suggests improving but still moderate bullish momentum.
This further warrants some caution before placing aggressive bullish bets on the EUR/USD pair and positioning for an extension of the recent recovery from the 1.1325 region, or the year-to-date low touched in June. The subsequent resistance below the 23.6% Fibo. aligns at the 200-period Simple Moving Average (SMA) on the 4-hour chart, near 1.1490, with the 38.2% retracement near 1.1523 and the 50.0% level around 1.1585 acting as the next relevant hurdles.
On the downside, the main structural support emerges at the Fibonacci anchor close to 1.1323, and a clear break under this floor would likely reinforce the broader bearish outlook for the EUR/USD pair.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
EUR/USD 4-hour chart
US Dollar Price Today The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Swiss Franc.
USDEURGBPJPYCADAUDNZDCHFUSD-0.16%-0.05%-0.08%-0.10%-0.17%-0.03%-0.00%EUR0.16%0.05%0.07%0.05%-0.06%0.07%0.15%GBP0.05%-0.05%0.02%-0.01%-0.11%0.02%0.09%JPY0.08%-0.07%-0.02%-0.03%-0.11%0.03%0.06%CAD0.10%-0.05%0.01%0.03%-0.07%0.00%0.10%AUD0.17%0.06%0.11%0.11%0.07%0.11%0.16%NZD0.03%-0.07%-0.02%-0.03%-0.01%-0.11%0.07%CHF0.00%-0.15%-0.09%-0.06%-0.10%-0.16%-0.07% 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 US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
EUR/USD trades higher near 1.1420 on Tuesday as the US Dollar (USD) weakens following softer-than-expected United States (US) inflation data. The Euro’s recovery remains mainly driven by broad Greenback selling rather than Eurozone developments.
The US Consumer Price Index (CPI) declined 0.4% MoM in June, compared with expectations for a 0.1% decrease and May’s 0.5% increase. Annual inflation slowed sharply to 3.5% from 4.2%, below the 3.8% market forecast. Core CPI remained unchanged on the month, while the annual underlying rate eased to 2.6% from 2.9%.
US employment indicators also softened, with the ADP Employment Change four-week average declining to 19.75K from 21K. The figures reduced expectations of a Federal Reserve (Fed) interest-rate increase in July, placing additional pressure on the US Dollar.
However, Fed Chair Kevin Warsh maintained a relatively hawkish tone during his congressional testimony, reiterating the central bank’s commitment to controlling persistent inflation. Warsh also described the US labor market as broadly stable, highlighting low unemployment, limited layoffs and solid nominal wage growth.
Geopolitical developments remain in focus after US President Donald Trump said the United States would impose a full blockade, but only on vessels traveling to and from Iranian ports. Trump also abandoned the proposed 20% US reimbursement fee for cargo crossing the Strait of Hormuz, replacing it with trade and investment agreements involving Gulf states.
Short-term technical analysis:In the four-hour chart, EUR/USD trades at 1.1423, holding a mildly bullish bias as it sits above both the 20-period Simple Moving Average (SMA) at 1.1418 and the 100-period SMA at 1.1408. The clustering of these averages just beneath spot suggests underlying demand on shallow dips, while the Relative Strength Index (RSI) around 52.7 leans slightly positive without yet signaling overbought conditions.
On the topside, immediate resistance emerges at the horizontal barrier at 1.1434, followed by a stronger cap at 1.1446. On the downside, initial support is seen at the 20-period SMA at 1.1418, ahead of the nearby horizontal floor at 1.1416. A deeper pullback would expose the 100-period SMA at 1.1408 and the lower horizontal level at 1.1404 as the next key demand areas.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
U.S. Dollar Pulls Back As Inflation Rate Misses Estimates
DXY 140726 4h Chart U.S. Dollar Index is losing ground as traders react to CPI report. The report indicated that Inflation Rate decreased from 4.2% in May to 3.5% in June, compared to analyst forecast of +3.8%. Core Inflation Rate pulled back from 2.9% to 2.6%, while analysts expected that it would drop to 2.8%.
Lower-than-expected inflation data put material pressure on the American currency as traders reduced bets on hawkish Fed. However, the strong rally in the oil markets may raise prices again, so it remains to be seen whether the pullback in inflation is sustainable.
The nearest support level for U.S. Dollar Index is located in the 100.50 – 100.65 range. In case U.S. Dollar Index manages to settle below the 100.50 level, it will head towards the next support, which is located in the 99.75 – 99.90 range.
EUR/USD Tests Resistance At 1.1420 – 1.1435 EUR/USD 140726 4h Chart EUR/USD moved higher as traders focused on U.S. inflation data. In the EU, traders had a chance to take a look at the Wholesale Prices report from Germany. The report indicated that Wholesale Prices declined by -0.7% month-over-month in June, compared to analyst forecast of +0.5%.
From the technical point of view, EUR/USD continues its attempts to settle above the resistance level at 1.1420 – 1.1435. In case EUR/USD climbs above the 1.1435 level, it will head towards the next resistance at 1.1500 – 1.1515. RSI remains in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.
GBP/USD Moves Higher As Traders Reduce Bets On Hawkish Fed GBP/USD 140726 4h Chart GBP/USD gained ground, supported by U.S. CPI report. Traders bet that Fed will be less hawkish as inflation has started to calm down. Traders also focus on comments from Fed Chair Warsh. He said that CPI decline did not mean that Fed accomplished its mission.
In case GBP/USD pulls back below the 50 MA at 1.3376, it will head towards the nearest support level at 1.3335 – 1.3350. A successful test of of this level will open the way to the test of the next support at 1.3250 – 1.3265.
On the upside, GBP/USD needs to settle above the resistance at 1.3450 – 1.3465 to have a chance to gain additional upside momentum in the near term.
USD/CAD Tests New Lows
USD/CAD 140726 4h Chart USD/CAD is losing ground as lower-than-expected U.S. CPI data provided material support to commodity markets. Other commodity-related currencies are also moving higher in today’s trading session.
USD/CAD settled below the previous support at 1.4125 – 1.4140 and is trying to settle below the 1.4050 level. In case this attempt is successful, it will head towards the next support at 1.4000 – 1.4025.
USD/JPY Moves Lower As Treasury Yields Fall USD/JPY 140726 4h Chart USD/JPY is losing some ground as traders focus on the pullback in Treasury yields. The yield of 2-year Treasuries declined towards the 4.20% level, while the yield of 10-year Treasuries settled below 4.60%.
A move below the support level at 161.50 – 162.00 will push USD/JPY towards recent lows near the 160.50 level. It should be noted that USD/JPY failed to gain strong downside momentum as traders worried that rising oil prices will put pressure on Japan’s economy.
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As the trading week begins, the euro is once again showing a short-term bullish bias after the release of inflation data in the United States, which has helped ease strength around the U.S. dollar.
For now, EUR/USD is up more than 0.6% during the session and continues to trade above the 1.1400 level. This buying pressure is partly due to the fact that the new inflation data has triggered corrections in the U.S. bond market, a dynamic that does not favor the dollar.
If this behavior continues, relevant buying pressure could remain present in EUR/USD movements over the next few trading sessions.
U.S. CPI day arrives During the session, CPI data in the United States was released. Although an annual reading was expected, the official figure surprised to the downside and came in at 3.5%.
This figure marks an important change in the U.S. price dynamic, as it represents one of the most relevant declines of the year. In addition, June inflation moved away from the annual high of 4.2% and broke the upward trend that had been present in annual inflation levels since March.
With this result, inflation is once again moving somewhat closer to the central bank’s annual 2.00% target.
Source: TradingEconomics
This event is relevant for Federal Reserve expectations, as a consistent slowdown in inflation could prevent the view of a fully aggressive central bank from materializing over the coming months.
As inflation declines, the need to keep interest rates higher for a prolonged period also decreases. This perspective has started to be reflected in the 10-year U.S. bond market, where yields have shown some correction amid lower expectations of central bank aggressiveness.
After the upward trend seen last week, yields have started to move back below the 4.6% area, showing relevant weakness that had not been observed in recent sessions.
Source: TradingEconomics
The key point is that, as bond yields show weakness, the relative appeal of these fixed-income instruments compared to other markets may also decline. This could reduce the need to maintain consistent demand for dollars in order to access these types of assets.
This decline in bond yields coincides with weaker demand for U.S. dollars. This behavior is reflected in the DXY index, which measures the dollar’s strength against its main peers. The index is now showing a relevant decline and is approaching the 100-point reference area. This indicates that demand for dollars has started to weaken in the short term.
Source: TradingEconomics
With all of this in mind, the dynamic has been favorable for the euro. The release of the inflation data created renewed weakness in dollar demand, which could be allowing the euro to recover ground in the short term.
If the U.S. bond market fails to show attractive growth in yields, the dollar could continue to lose ground. In that scenario, EUR/USD could maintain relevant buying pressure over the next few trading sessions.
Technical outlook for EUR/USD
Source: StoneX, Tradingview
Recent recovery becomes relevant: Although a long bearish trend line has been present for months in average EUR/USD movements, the recent price recovery has started to weaken the long-term selling bias. This move could be opening room for a more neutral phase on the chart. Even though the bearish trend line has not yet been broken, price could start to stop forming new lows and enter a more consistent range. If this effect continues over the next few sessions and selling pressure fails to stabilize again, the continuation of the bearish trend line on the daily chart could start to come under pressure.
RSI: Now, the RSI has moved back toward the neutral 50 area. This suggests a balance between buying and selling impulses in the market. Rather than pointing to a clear directional move, the indicator highlights a possible phase of indecision that could remain relevant over the next few sessions.
MACD: A similar dynamic can be seen in the MACD, whose histogram remains very close to the neutral 0 level. This suggests balance in the average strength of short-term moving averages. This reading may also reflect relevant neutrality in short-term price movements.
Key levels:
1.15127 – Relevant resistance: This important high level coincides with a retracement area from previous weeks and also with the barrier formed by the 50-period moving average. Price movements attempting to break above this level could start to put the long bearish trend line at risk and open room for a more dominant buying bias over the coming weeks.
1.14253 – Near-term barrier: This level corresponds to the most relevant neutral area now. Price movements too close to this level could continue to highlight significant indecision and even open room for a possible short-term sideways range over the next few sessions.
1.12851 – Definitive support: This level is associated with a neutral area observed in May 2025 and now acts as the main support to watch. If price continues to move closer to this area, the selling bias would be reinforced and the possibility of an extension of the bearish trend line as the dominant chart structure over the coming weeks would increase.
Written by Julian Pineda, CFA, CMT – Market Analyst
ING’s Francesco Pesole argues that the EUR/USD short-term rate differential is currently supporting the Euro as Gulf tensions rise, helped by a recovery in EUR front-end rates. However, he doubts this can last if Oil and Gas prices keep climbing, given limited scope for more ECB hikes and worsening eurozone terms of trade. ING warns that EUR/USD could risk a move toward 1.10 under higher energy prices.
Euro buoyed by rates for now"The EUR:USD short-term rate differential is – for now – helping to keep EUR/USD afloat in this Gulf re-escalation. The two-year swap rate gap has re-tightened around 15bp since the start of July, primarily because the rebound in oil prices happened at a time when ECB hike bets were dwindling, leaving more upside room to recover for EUR front-end rates."
"We aren’t convinced this rate gap can offer sustainable support to EUR/USD if energy prices continue to rise though."
"Markets may find it harder to price in more than two ECB hikes by year-end (now, 46bp) considering the less hawkish stance by ECB officials of late, and the medium-term negative implications of an energy crisis – combined with Fed tightening – for the EUR, tend to outweigh the positive of EUR hikes."
"The spike in gas prices is particularly concerning, as it weighs on the eurozone’s terms of trade more than oil."
"In a scenario where Brent returns to $90-100/bl and TTF around €55-60/MWh, a move to 1.10 becomes a tangible risk in EUR/USD."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
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Escalating tensions between the US and Iran have once again pushed crude oil prices higher, providing further support for the US dollar. The greenback has performed particularly well against lower-yielding currencies, such as the Swiss franc, as investors seek both safety and higher returns while reassessing the inflation outlook. Although the euro has held up better than some of its peers, thanks to expectations that the European Central Bank may have to tighten its policy further, the balance of risks remain for the downside. If oil prices continue climbing, energy costs are likely to become a more powerful driver of FX markets than interest rate differentials, leaving the EUR/USD forecast increasingly bearish.
Oil-driven inflation fears revive the dollar Following that weak US jobs report, the dollar lost some momentum but it had now regained it as markets begin to price in the growing risk that renewed disruptions in the Gulf could tighten global energy supplies. Brent crude has climbed to around $87 a barrel, but current pricing still suggests investors are not fully convinced a major supply shock is imminent.
That leaves scope for both oil and the dollar to extend their gains should tensions escalate further. If you recall, oil prices reached north of $110 at the height of the crisis a few months ago, and spent majority of that time around the $100 level.
But unlike earlier in the year, the Fed is now not offering any forward guidance following its hawkish shift in June. That has encouraged markets to speculate more freely about additional policy tightening, with traders now assigning a meaningful probability to a rate increase before the end of the summer.
Warch or CPI unlikely to cause fireworks Attention now turns to Chair Kevin Warsh’s testimony before Congress, although he is expected to maintain his preference for avoiding strong policy signals. Several other Fed officials are also due to speak, while the latest US inflation figures could reinforce expectations that policymakers may have to tighten policy. Even if headline inflation eases because of earlier declines in energy prices, sticky core inflation is unlikely to provide much reassurance. What’s more, the latest upsurge in oil prices will shift inflation expectations higher for the coming months.
So, markets may not pay too much attention to a small miss in CPI, if we get one. Anyway, the headline figure is expected to print 3.8% year-on-year for June, down from 4.2% in May. Core CPI is seen easing modestly to 2.8% from 2.9%.
Euro supported by yields, but energy remains a headwind The euro has avoided sharper losses largely because eurozone bond yields have risen alongside US Treasury yields, preventing a significant widening in transatlantic rate differentials.
Markets continue to expect further ECB tightening this year, although policymakers have adopted a more cautious tone recently. That leaves limited room for expectations to become significantly more hawkish from here.
Meanwhile, the outlook for Europe is becoming increasingly complicated by higher energy prices. Rising natural gas costs pose a much greater challenge for the eurozone economy than for the United States. Should Brent crude climb towards the $100 area, the negative impact on Europe’s economy could easily outweigh any support generated by higher ECB rates, increasing the likelihood of a deeper EUR/USD decline.
Technical EUR/USD forecast: Bearish pattern points to further weakness The technical picture also continues to favour the bears. The EUR/USD remains confined within a bearish flag formation following its recent correction. A decisive break beneath the lower boundary of that pattern would strengthen the case for another leg lower, initially exposing the recent swing low around 1.1324.
Source: TradingView.com Below there, the 1.1300 area becomes the next key objective for the EURUSD chart. That level also coincides with the 127.2% Fibonacci extension of the March-to-April rally, making it an important technical support zone.
Given the combination of rising energy prices, improving dollar sentiment and the prospect of further Fed tightening, rallies may continue to attract sellers.
On the upside, initial resistance is located around 1.1450, with a stronger barrier between 1.1480 and 1.1500.
With the eurozone economic calendar relatively light in the days ahead, the EUR/USD forecast is tilted to the downside. The pair is likely to remain driven primarily by developments in oil markets, geopolitical headlines and evolving expectations for US monetary policy rather than domestic European data.
EURUSD (The euro) continues to retreat after failing to break back above the recent high, which saw prices push towards a fresh peak.
The pair bounced off the support zone at 1.1380 as the RSI bounced away from the oversold region. Further resistance at the 1.1460 region would send the euro lower, breaking the previous support zone. A successful bounce and a close below 1.1380 would commit more sellers and push the pair towards 1.1300.
NZDUSD tests key resistance area
The New Zealand dollar attempts to continue its progression as the pair jumps over 100 pips in recent sessions.
The price was moving towards the previous swing high at 0.5800, which, if broken, opens another 50-pip jump. Still, the recent bounce could be a sign of bearish pressure building since the market open. A decisive break below 0.5700 would force the remaining buyers out and open the door to a test at the previous swing low of 0.5660. US30 recapturing the recent high
The Dow steadies as traders await more news of a jump in tech stocks, and then the next step in the Middle Eastern conflcit.
A close above the daily resistance of 53000 would help bulls regain control of the direction. A confirmation past this level would lead to the index gearing up for another attempt at a record high above 53400. The recent dip at 52200 is the first support, and 51600 is the bulls’ second layer of defence. Market Strategist at Orbex David Kindley is a renowned fundamental analyst with over 10 years of trading experience in the financial markets. With a keen eye for macroeconomics and a special focus on trading psychology, David is passionate about helping everyday investors make informed trading decisions through his thorough research and analysis.
United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann report that EUR/USD slid to 1.1377 and closed at 1.1381, a two‑week low, as the Dollar strengthened ahead of United States (US) Consumer Price Index (CPI). While short‑term momentum has turned lower, they see limited scope for sustained losses, with 1.1360 and 1.1325 as key supports and range‑trading between 1.1360 and 1.1450 still the base case.
Euro pressured within defined range"24-HOUR VIEW: EUR opened with a slight gap down yesterday. When it was at 1.1395, we indicated that “while the increasing downward momentum suggests EUR could decline further, the major support at 1.1360 could be out of reach.” We noted that “there is another support level at 1.1375.” We added, “to sustain the downward momentum, EUR must hold below 1.1420.” The subsequent price movements did not unfold as expected. EUR popped to a high of 1.1445 before plummeting to a low of 1.1377. EUR closed on a soft note at 1.1381 (- 0.28%). While the bias remains on the downside today, downward momentum is not particularly strong after the rise to 1.1445. Overall, as long as EUR holds below 1.1415 (minor resistance is at 1.1400), there is a chance for EUR to drop below 1.1360. That said, a continued drop below this level appears unlikely. The major support at 1.1325 is also unlikely to come into view."
"1-3 WEEKS VIEW: Our most recent narrative was from last Thursday (09 Jul, spot at 1.1420), when we highlighted that EUR “has likely moved back into a range-trading phase, expected to be between 1.1360 and 1.1450.” Yesterday, EUR fell to a low of 1.1377. The slight increase in downward momentum is insufficient to indicate a sustained decline. EUR must close below 1.1360 before a move to 1.1325 can be expected. The likelihood of EUR closing below 1.1360 will remain intact as long as EUR holds below 1.1445."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
EURUSD maintains an incomplete bearish sequence from the January 27, 2026 peak, leaving room for further downside. The projected target zone is defined by the 100% to 161.8% Fibonacci extension from the January 27 high, which falls between 1.076 and 1.117. This extension range provides a precise technical framework for anticipating the next leg lower. In the near term, the cycle from the July 2, 2026 high has unfolded into a five‑swing decline, reinforcing the bearish bias and signaling additional weakness.
From the July 2 high, wave ((i)) concluded at 1.139 as a diagonal structure. A corrective rally in wave ((ii)) terminated at 1.146, after which the pair resumed its downward trajectory in wave ((iii)). The internal subdivision of wave ((iii)) is unfolding as another five‑wave impulse. Within this structure, wave (i) ended at 1.138, while wave (ii) retraced to 1.145. These developments confirm that the decline remains active and incomplete. As long as the pivot at 1.147 holds, rally should fail in 3 or 7 swing and EURUSD is expected to continue pressing lower. A decisive break below the June 24 low at 1.1324 is required to eliminate the possibility of a double correction.
EURUSD 60-Minute Elliott Wave Chart EURUSD Elliott Wave Video: You are currently viewing a placeholder content from Default. To access the actual content, click the button below. Please note that doing so will share data with third-party providers.
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The shared currency begins the week on a lower note, down 0.31% as risk aversion fueled flows towards the US Dollar amid heightened tensions in the Middle East. Also, hawkish comments by a Fed official underpinned US Treasury yields, suggesting markets expect the US central bank to raise rates. The EUR/USD trades at 1.1379 after reaching a high of 1.1445.
EUR/USD falls as Oil shock revives Fed tightening fearsThe strength of the US Dollar is the main reason the Euro is being battered. The positive correlation between the Greenback and Oil prices suggests that a rally in crude prices triggers a flight to safety in the foreign exchange market. Why? Because high energy prices fuel speculation that major central banks — including the Federal Reserve- might need to raise interest rates.
Alongside the challenging geopolitical environment, Fed Governor Christopher Waller noted that a high core inflation reading would prompt immediate consideration of a rate hike. Although he maintains a hawkish stance, he believes it's plausible inflation could hit the 2% target without increasing rates and mentioned that the labor market is nearer to the Fed’s maximum employment objective.
This triggered a jump in US Treasury yields, with the US 10-year T-note surging 6 basis points to 4.624%, indicating that investors are preparing for an imminent rate hike by the Fed.
Consequently, the US Dollar Index (DXY), which measures the value of the American currency against six other currencies, is up 0.32% at 101.28.
Money markets are pricing in nearly 42 basis points of Federal Reserve tightening, according to Prime Terminal data.
Source: Prime TerminalBreaking news revealed that US CENTCOM announced at 16:45 ET that it began launching a third consecutive night of strikes against Iran. Iranian media reported that explosions were heard in Bandar Abbas and revealed that Iran’s army targeted US military facilities in Kuwait and a “hostile” US vessel with cruise missiles.
The US economic docket will feature the release of crucial US inflation data and the testimony of Fed Chair Kevin Warsh before the US Congress. Across the pond, the Eurozone schedule ill feature a speech by the European Central Bank (ECB) President Christine Lagarde.
EUR/USD Price Forecast: Technical outlook
EUR/USD daily chartIn the daily chart, EUR/USD trades at 1.1385, keeping a bearish near-term bias as the pair holds beneath the clustered 50-, 100- and 200-day Simple Moving Average (SMA) around 1.1554 and within a downward parallel channel. The Relative Strength Index (RSI) at about 37 stays in bearish territory, suggesting downside pressure persists while the price remains capped by the channel structure and the descending trend-line that was previously broken near 1.1600.
On the topside, initial resistance is seen near 1.1422, where the lower boundary of the current downward channel now sits above spot, followed by the grouped daily SMAs around 1.1554, which reinforce the broader cap. Further up, the channel top near 1.1596 and the prior trend-line break area at 1.1600 form a dense resistance band ahead of the horizontal barrier at 1.1849, while the absence of clearly defined support below the market leaves EUR/USD vulnerable to further weakness if selling resumes.
(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:EUR/USD pulled back as traders reacted to the strong rally in the oil markets. USD/CAD was mostly flat as traders focused on the pullback in precious metals markets. USD/JPY climbed towards the 162.50 level amid rising Treasury yields.
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U.S. Dollar Gains Ground As Oil Prices Rally
DXY 130726 4h Chart U.S. Dollar Index gains ground as traders focus on geopolitical developments. President Trump said that U.S. will impose a naval blockade on Iranian ports. He added that U.S. will become a “guardian” in the Strait of Hormuz and would charge fees at a rate of 20% on all cargo shipped.
Currently, U.S. Dollar Index is trying to settle above the resistance level at 101.15 – 101.30. In case this attempt is successful, U.S. Dollar Index will move towards the next resistance level, which is located in the 101.80 – 101.95 range.
EUR/USD Retreats As Traders Bet On Hawkish Fed
EUR/USD 130726 4h Chart EUR/USD pulled back as traders focused on the strong rally in the oil markets. Brent oil gained 5% as the flow of oil through the Strait of Hormuz would drop after U.S. decision to impose a naval blockade on Iran. Most likely, Iran will try to attack vessels passing through the Strait without the country’s permission.
EUR/USD failed to settle above the resistance at 1.1420 – 1.1435 and pulled back towards the 1.1400 level. If EUR/USD manages to settle below the 1.1400 level, it will head towards the nearest support, which is located in the 1.1350 – 1.1365 range. RSI is in the moderate territory, so there is plenty of room to gain additional downside momentum in case the right catalysts emerge.
GBP/USD Pulls Back Amid Rising Geopolitical Tensions GBP/USD 130726 4h Chart GBP/USD moved lower as traders worried that rising oil prices will force the Fed to raise rates sooner rather than later, which would be bullish for the American currency.
In case GBP/USD declines below the 50 MA at 1.3366, it will get to the test of the support at 1.3335 – 1.3350. A move below the 1.3335 level will open the way to the test of the next support level at 1.3250 – 1.3265.
USD/CAD Remains Stuck Near Support At 1.4125 – 1.4140 USD/CAD 130726 4h Chart USD/CAD continued its attempts to settle below the support at 1.4125 – 1.4140 despite the strong pullback in precious metals markets. Gold declined towards the psychologically important $4000 level, while silver pulled back below $58.00. Other commodity-related currencies were mixed in today’s trading session.
If USD/CAD settles below the 1.4125 level, it will move towards the support level at 1.4010 – 1.4025. On the upside, USD/CAD needs to stay above the 1.4140 level to have a chance to gain upside momentum in the near term. In this case, USD/CAD will head towards the 50 MA at 1.4185. A move above the 50 MA will push USD/CAD towards the resistance at 1.4225 – 1.4240.
USD/JPY Gains Ground As Treasury Yields Rise
USD/JPY 130726 4h Chart USD/JPY is moving higher as traders focus on rising Treasury yields. The yield of 2-year Treasuries moved above the 4.25% level, while the yield of 10-year Treasuries settled above 4.60%.
If USD/JPY stays above the support level at 161.50 – 162.00, it will move towards recent 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. It remains to be seen whether Bank of Japan is ready to provide support to the Japanese yen.
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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.
The euro is forecast to come under renewed pressure against the US dollar this month as rising energy prices reinforce expectations that the Federal Reserve may need to keep monetary policy tighter for longer, according to ING. ING believes the deteriorating situation in the Gulf is proving more supportive for the US dollar than the euro, with higher oil and natural gas prices creating a particularly difficult backdrop for energy-importing Europe while simultaneously keeping US inflation concerns alive.
Why Higher Energy Prices Favour the US Dollar According to ING, two themes are dominating currency markets: rising energy prices and strong demand for higher-yielding currencies.
The bank argues that renewed disruption risks in the Gulf are strengthening the US dollar because higher energy costs could keep Federal Reserve tightening expectations alive.
At the same time, Europe remains more vulnerable to higher energy prices, with natural gas costs beginning to climb again at a time when inventories remain relatively low.
That combination leaves the euro at a disadvantage against the dollar in the near term.
Why the Euro Is Losing Momentum ING says last week's corrective rebound in EUR/USD has already started to lose momentum.
The bank notes that higher gas prices have capped the euro's recovery, while a relatively quiet Eurozone economic calendar means energy markets are likely to have a greater influence on short-term price action than comments from European Central Bank officials.
EUR/USD was trading close to 1.1414 on Monday afternoon after remaining largely unchanged over the past week, having already fallen more than 2% during June.
The Federal Reserve Holds the Key ING believes upcoming US inflation data and testimony from Federal Reserve Chair Kevin Warsh will be the biggest catalysts for EUR/USD this week.
Although headline inflation may soften, the bank expects rising energy prices and resilient core inflation to keep the prospect of another Fed rate increase firmly on the table.
If markets continue to believe US interest rates could remain higher for longer, the dollar is likely to stay well supported against lower-yielding currencies such as the euro.
What's the Forecast for the Euro versus the US Dollar? ING expects EUR/USD to drift lower in the near term outlook.
The bank believes the exchange rate can easily fall towards 1.1360 and says a test of the 1.1300-1.1325 area is possible later this month if energy prices continue rising and markets maintain expectations for tighter US monetary policy.
Even so, ING does not expect that area to give way easily, suggesting it is likely to provide an important floor for EUR/USD during the summer unless the macroeconomic backdrop deteriorates further.
EUR/USD Forecast FAQWhy does ING expect EUR/USD to weaken?
ING believes higher oil and natural gas prices favour the US dollar by keeping expectations for Federal Reserve tightening alive while simultaneously weighing on the euro through higher European energy costs.
What is ING's near-term EUR/USD target?
ING believes EUR/USD can fall towards 1.1360 initially, with scope to test the 1.1300-1.1325 area later this month.
Why are natural gas prices important for the euro?
Europe remains heavily exposed to imported energy. Rising gas prices increase inflation risks and can weaken the region's growth outlook, making the euro less attractive.
What could stop EUR/USD falling?
A decline in energy prices or signs that the Federal Reserve no longer needs to consider another interest rate increase would reduce support for the US dollar and could help stabilise EUR/USD.
EUR/USD trades with a mild positive bias on Monday as the US Dollar (USD) gives back its earlier gains. At the time of writing, the pair trades around 1.1424 after recovering from an intraday low of 1.1384.
The Greenback opened the week higher after the United States (US) and Iran exchanged missile and drone attacks over the weekend. Washington struck targets in southern Iran, while Tehran targeted US military facilities across the Gulf. Iran also claimed that it had once again closed the Strait of Hormuz.
In an interview with Fox News on Monday, US President Donald Trump said the United States would be the “guardian” of the Strait of Hormuz and added, “We had a deal, and they broke it.”
The US Dollar Index (DXY), which tracks the Greenback against a basket of six major currencies, slips back below 101.00 after touching an intraday high of 101.22.
The US Dollar has failed to benefit from the latest hostilities as markets see little chance of the fighting turning into a full-blown war, while diplomatic efforts continue.
However, the US Dollar’s downside appears limited, as the situation remains fluid and energy-driven inflation concerns return to the forefront. West Texas Intermediate (WTI) crude Oil is up more than 3% on Monday, trading around $74.00 per barrel.
ING analysts noted, “With energy prices turning bid again and no signs of an imminent slowdown in US activity to take the sting out of higher prices, (keeping Fed tightening prospects alive), the Dollar should hold onto its gains.” They added that the Greenback is likely to remain favoured against low-yielding energy importers such as the Euro and the Japanese Yen.
Traders are increasingly pricing in a Federal Reserve (Fed) interest rate hike by year-end, while also expecting another rate increase from the European Central Bank (ECB).
The US Consumer Price Index (CPI) data on Tuesday and the Eurozone’s final inflation figures on Friday will be closely watched for fresh clues about the monetary policy outlook on both sides of the Atlantic.
Euro Price Today The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the Japanese Yen.
USDEURGBPJPYCADAUDNZDCHFUSD-0.08%0.09%0.29%-0.10%0.19%-0.29%0.17%EUR0.08%0.17%0.35%-0.03%0.28%-0.16%0.26%GBP-0.09%-0.17%0.22%-0.20%0.12%-0.32%0.14%JPY-0.29%-0.35%-0.22%-0.41%-0.11%-0.55%-0.07%CAD0.10%0.03%0.20%0.41%0.31%-0.12%0.34%AUD-0.19%-0.28%-0.12%0.11%-0.31%-0.40%0.06%NZD0.29%0.16%0.32%0.55%0.12%0.40%0.47%CHF-0.17%-0.26%-0.14%0.07%-0.34%-0.06%-0.47% 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).
Energy prices are once again setting the tone for currency markets, with the renewed tensions in the Middle East reinforcing the dollar’s appeal while weighing on low-yielding and energy-importing currencies. As oil and natural gas prices climb, investors are becoming increasingly reluctant to price out further Fed tightening, providing the greenback with another tailwind. This is keeping the near-term EUR/USD forecast tilted to the downside.
Dollar remains bid as oil climbs on fresh escalation At the weekend, the US launched fresh strikes on dozens of Iranian military targets after Iran attacked commercial shipping in the Strait of Hormuz. Targets reportedly included air-defense systems, radar installations, missile and drone capabilities, and naval assets. In retaliation, Iran said it targeted US military bases in Jordan, Bahrain, and Kuwait, as well as radar systems in Oman.
The latest exchanges mark a significant intensification of tensions between Washington and Tehran. Last week, US President Donald Trump declared that the US-Iran ceasefire was “over” and sharply criticized Iran’s leadership. What it means for the markets is that the re-escalation has disrupted maritime traffic through the Strait of Hormuz. No commercial vessels have transited the waterway since Sunday evening, according to reports tracking shipping data. In turn, oil prices have surged higher again.
With crude oil rising once again, the obvious question is: what does this mean for the US dollar?
Given that the Fed’s new chairman has made it clear that he wants to keep inflation under control, another spike in oil prices is likely to reinforce expectations that US interest rates will stay higher for longer. Even if some of the near-term economic data softens, persistently high energy prices would make it difficult for the Fed to adopt a more dovish stance.
That is one of the reasons why we’re seeing the US dollar regain momentum, particularly against currencies whose economies are heavily reliant on imported energy, such as the euro and the Japanese yen.
Should Iran succeed in disrupting shipping through the Strait of Hormuz for al lengthy period of time once again, the US is likely to be viewed as relatively insulated thanks to its energy independence. At the same time, higher oil prices would add to inflationary pressures, making it harder for the Fed not to signal intentions of policy tightening.
US CPI and Warsh testimony in focus The focus now turns to a busy week for US economic data and Federal Reserve officials. Tuesday’s inflation report will be closely watched, with headline CPI expected to ease 0.1% on a monthly basis, lowering the year-over-year rate to 3.8% from 4.2%. However, firmer energy prices and sticky core inflation, still hovering around 2.9% year-on-year, suggest it remains premature to rule out at least one rate increase before the end of the year.
Markets will also hear from Fed Chair Kevin Warsh as he begins two days of testimony before Congress. Investors will be looking for any clues on the policy outlook. With energy prices firming and little evidence that the US economy is slowing enough to offset inflation risks, Warsh is unlikely to sound dovish at all. So, the fundamental backdrop continues to favour the dollar.
That leaves low-yielding, energy-dependent currencies such as the euro and the yen particularly vulnerable, meaning that the EUR/USD forecast is tilted to the downside. Of particular concern for Europe is the renewed strength in natural gas prices, especially with inventories still relatively low and demand rising (for air cooling systems) amid elevated summer temperatures.
Technical EUR/USD forecast and key levels to watch That combination leaves the euro exposed. In the near term, the EUR/USD could drift back towards the 1.1350 region, with a follow-up move into the 1.1300 area looking increasingly plausible over the coming days and weeks.
Source: TradingView.com There is also a bearish flag pattern to consider, too. If there EUR/USD breaks below the support trend of the pattern, which is what I expect, then at the very least I’d anticipate a retest of the recent lows around 1.1324.
Below that the 1.1300 area would come into focus. This level also lines up with the 127.2% Fibonacci extension of the major advance we saw between March and April. Given what’s happening in the oil market, together with the prospect of a more hawkish Fed, the path of least resistance for EUR/USD still appears to be to the downside.
Resistance is seen around 1.1450, followed by the 1.1480-1.1500 region.
Meanwhile, the European data calendar is relatively quiet this week, meaning short-term moves in the euro are likely to be driven more by developments in energy markets and shifts in US rate expectations than by domestic fundamentals.
EUR/USD gains ground after posting losses in the previous day, trading around 1.1440 during the European hours on Monday. The currency pair holds just above the nine-day Exponential Moving Average (EMA) but remains capped by the 50-day EMA, keeping the near-term tone cautiously bearish.
The 14-day Relative Strength Index (RSI) at 45 stays below the neutral 50 line, hinting that rebounds lack strong momentum even as price stabilizes slightly off recent lows. The daily chart technical analysis indicates that the EUR/USD pair is remaining slightly above the descending channel pattern, suggesting that while a bearish bias persists, immediate downside momentum is pausing as buyers defend the channel's upper boundary.
A successful break below the nine-day EMA of 1.1425 could pull EUR/USD back toward the descending channel and target the 13-month low of 1.1322, which was recorded on June 24. A break below this level could put downward pressure on the pair to navigate the area around the lower boundary of the descending channel at 1.1060.
On the upside, the primary barrier lies at the three-week high of 1.1472, reached on July 2, followed by the 50-day EMA of 1.1521.
EUR/USD: Daily Chart(The technical analysis of this story was written with the help of an AI tool. Know more.)
Euro Price Today The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the Japanese Yen.
USDEURGBPJPYCADAUDNZDCHFUSD-0.15%0.07%0.23%-0.10%0.19%-0.33%-0.02%EUR0.15%0.22%0.39%0.05%0.35%-0.14%0.15%GBP-0.07%-0.22%0.17%-0.17%0.15%-0.34%-0.04%JPY-0.23%-0.39%-0.17%-0.34%-0.04%-0.52%-0.20%CAD0.10%-0.05%0.17%0.34%0.31%-0.16%0.14%AUD-0.19%-0.35%-0.15%0.04%-0.31%-0.45%-0.14%NZD0.33%0.14%0.34%0.52%0.16%0.45%0.31%CHF0.02%-0.15%0.04%0.20%-0.14%0.14%-0.31% 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).
EUR/USD opens the week around 1.1433. Investors continue to assess the situation in the Middle East, where uncertainty remains high. Oil prices corrected lower following a sharp rise at the start of the week, after reports that the United States and Iran intend to continue peace negotiations.
At the same time, fresh mutual strikes between the parties have heightened fears that the conflict could once again enter an escalation phase, leaving the prospects for maintaining the ceasefire uncertain.
Renewed hostilities have brought fears of a new inflation wave back to the market, supporting expectations of further Federal Reserve monetary tightening. Markets currently estimate the probability of a rate hike in September at approximately 62%, up from 58% a week earlier, though this figure exceeded 70% mid-week.
Additional attention has been drawn to comments from New York Federal Reserve President John Williams, who noted that one of the key drivers of inflationary pressure in the United States remains demand growth, linked to developments in artificial intelligence technology.
The main event of the week will be the release of the US June consumer price index (CPI). Higher-than-expected figures would reinforce expectations that the Fed will maintain a tight policy stance, potentially supporting the dollar. Conversely, weaker-than-forecast CPI data would increase pressure on the US currency, as markets would begin to price in a softer monetary policy trajectory once again
Technical Analysis
On the H4 chart of EUR/USD, the market has formed a consolidation range around the 1.1410 level, currently extending down to 1.1388 and up to 1.1410. A consolidation range around this level is practically complete. An upside breakout would suggest a corrective wave developing to 1.1450, followed by a decline to 1.1260. A direct downside breakout would open potential for a downward wave to 1.1260. Technically, this scenario is confirmed by the MACD indicator-its signal line is above zero but pointing strictly downwards, reflecting continued bearish momentum with the potential for the trend to continue lower.
On the H1 chart, the market has completed the next growth wave to the 1.1412 level. A consolidation range is currently forming below this level. Today, a range expansion down to 1.1366 and up to 1.1400 is expected, followed by a decline to 1.1260. Technically, this scenario is confirmed by the Stochastic oscillator-its signal line is above 50 and pointing strictly up to 80, before a subsequent decline to 20.
Conclusion EUR/USD is treading water at the start of the week as markets await key US inflation data that could set the tone for the Federal Reserve’s policy path. Geopolitical uncertainty in the Middle East remains elevated, with conflicting signals-renewed peace talks on one hand and fresh military strikes on the other-keeping investors cautious. Inflation expectations have been reinforced by escalating tensions, pushing September rate hike probabilities higher despite a mid-week dip. Comments from NY Fed’s Williams on AI-driven demand as an inflation factor have added another dimension to the debate. All eyes are now on Wednesday’s CPI release: a stronger print could boost the dollar, while a weaker outcome would ease pressure on the euro. Technically, the bearish outlook for EUR/USD remains intact, with downside potential towards 1.1260 in the medium term.
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EUR/USD has slipped as renewed US-Iran tensions strengthened safe-haven demand for the US dollar and pushed Treasury yields higher. A break below 1.1370 could expose the pair to 1.1350 and 1.1300, while recovery attempts remain capped near the 1.1475 to 1.1500 area. US inflation data is the next major catalyst, with a hotter CPI reading likely to reinforce dollar strength and increase pressure on the euro. EUR/USD came under renewed selling pressure on Monday as fresh military exchanges between the United States and Iran revived demand for the US dollar and lifted global energy prices.
The pair struggled to build on last week’s recovery and moved back toward the lower end of its recent range as investors prepared for the latest US Consumer Price Index report. Higher crude oil prices have added to inflation concerns, pushing US Treasury yields higher and strengthening expectations that the Federal Reserve may keep interest rates restrictive for longer.
The Dollar Index has recovered toward the 101.00 area after ending the previous week lower. For EUR/USD, the stronger greenback has brought the 1.1370 support level back into focus, with traders assessing whether the pair can stabilize or extend its decline toward 1.1350 and 1.1300.
Why Is EUR/USD Falling Today? The latest weakness in EUR/USD reflects a combination of geopolitical risk, higher oil prices and rising US bond yields.
Fresh attacks between the US and Iran over the weekend raised concerns about the future of shipping through the Strait of Hormuz. Iran said the key waterway had been closed again, while Washington maintained that commercial traffic could continue.
The conflicting claims sent crude oil prices sharply higher and revived concerns that another energy shock could keep global inflation elevated.
Higher oil prices tend to support the US dollar during periods of market stress. They can also place additional pressure on the euro because the Eurozone relies heavily on imported energy, leaving the region more exposed to rising fuel costs.
US CPI Could Decide the Dollar’s Next Move The US inflation report is likely to become the most important driver for EUR/USD in the near term.
A stronger-than-expected CPI reading would reinforce expectations that the Federal Reserve may need to maintain higher interest rates or consider additional tightening later this year. That outcome would likely push Treasury yields and the dollar higher, increasing the risk of EUR/USD falling through its current support zone.
A softer inflation report would create a different setup. It could reduce pressure on the Fed to tighten policy further and allow EUR/USD to recover some of its recent losses.
However, the impact of softer inflation could be limited if oil prices continue rising or geopolitical tensions worsen.
Euro Recovery Struggles Near 1.1500 EUR/USD recently recovered from lows around 1.1325 and moved above 1.1420, but the advance stalled before the pair could establish a sustained move through the 1.1475 to 1.1500 region.
That failure suggests sellers remain active whenever the euro approaches higher levels.
The pair now faces an important test around 1.1370. A clear move below that level would increase the likelihood of a decline toward 1.1350, followed by the June low near 1.1325. If selling pressure persists, the psychological 1.1300 level could become the next target.
On the upside, EUR/USD would need to recover above 1.1450 before challenging 1.1475 and 1.1500 again. A sustained break through 1.1500 would weaken the immediate bearish outlook and could support a broader recovery toward 1.1580.
ECB and Fed Policy Expectations Remain Divided Interest-rate expectations on both sides of the Atlantic continue to shape the EUR/USD outlook.
The Federal Reserve remains focused on inflation after stronger energy prices complicated the outlook for consumer prices. Recent weakness in US employment reduced expectations of immediate tightening, but the latest geopolitical escalation has prevented markets from fully dismissing the possibility of another rate increase.
In Europe, softer core inflation has reduced expectations of further European Central Bank tightening. That leaves the euro with less policy support, particularly if US inflation remains elevated and Treasury yields continue climbing.
Comments from Federal Reserve and ECB officials will therefore remain important as traders look for any change in the policy outlook.
EUR/USD Outlook The near-term EUR/USD price forecast remains cautious as the pair struggles to hold its recent recovery.
The US dollar is benefiting from safe-haven demand, rising oil prices and higher Treasury yields, while the euro faces renewed pressure from Europe’s exposure to imported energy costs.
A break below 1.1370 would put 1.1350 and 1.1300 within reach. However, softer US inflation or an easing of Middle East tensions could weaken the dollar and help EUR/USD return toward 1.1450 and 1.1500.
For now, US CPI and developments surrounding the Strait of Hormuz are likely to determine whether the pair stabilizes or begins another leg lower.
Why is EUR/USD falling today?
EUR/USD is falling as renewed US-Iran tensions increase safe-haven demand for the US dollar. Rising oil prices and Treasury yields have also strengthened expectations that US interest rates may remain elevated.
What are the key EUR/USD levels to watch?
The main support levels are 1.1370, 1.1350 and 1.1300. Resistance is located near 1.1450, followed by 1.1475 and 1.1500.
How could US CPI affect EUR/USD?
A hotter US CPI reading could strengthen the dollar and push EUR/USD lower by increasing expectations of tighter Federal Reserve policy. Softer inflation could weaken the greenback and support a euro recovery.
Fragile rebounds across precious metals and major FX pairs face renewed risks from the latest developments around the Strait of Hormuz and this week's US CPI report. Key technical levels remain in focus to determine the next directional breakout.
Iran and the US exchanged strikes following the disruption of the ceasefire framework. The US launched strikes against Iran's key Hormuz gateway and military infrastructure. Iran launched strikes against commercial shipping in the Strait of Hormuz, including oil and LNG vessels. Fed Governor Kevin Warsh is expected to testify on Wednesday following Tuesday's US CPI report. US CPI is expected to decline from 4.2% to 3.8%, in line with the more than 40% decline in crude oil prices from their yearly highs. Crude oil prices continue to hold a fragile bullish rebound following the latest strikes, within a broader selloff driven by oversupply risks, rising OPEC+ production quotas, and recovering Gulf production and exports. Latest analysis: Crude Oil Weekly Outlook: Oversupply Risks Challenge WTI & Brent Despite Hormuz Tensions EUR/USD and gold are also holding fragile rebounds despite persistent US dollar strength, supported by lingering inflationary pressures stemming from the US-Iran conflict, reinforcing expectations for a higher-for-longer interest rate environment. As the US Dollar Index (DXY) holds above 101: EUR/USD continues to face bearish pressure below 1.1470. Gold continues to face bearish pressure below 4,200. EUR/USD Price Outlook: Monthly Time Frame – Log Scale
Source: TradingView
Key points from this chart:
EUR/USD's monthly price action continues to test the multi-year resistance-turned-support zone between 1.1280 and 1.1300. This area aligns with the 38.2% Fibonacci retracement of the January 2025-January 2026 advance. A breakdown below 1.1280 would expose the 1.1130-1.1000 region, where the 50% Fibonacci retracement converges with the upper boundary of the 2008-2025 descending channel, creating another potential major rebound zone. On the upside, a sustained move back above 1.1470, followed by 1.1600, would reinforce bullish continuation toward the key 1.1730-1.1800 resistance area. This zone could either trigger another major pullback or open the door for a rally toward levels last seen in 2021 and 2018 near 1.2300. These scenarios largely depend on whether the US dollar pulls back or breaks above its major resistance zone, as discussed in this video. USD/JPY Bulls Prepare for Major Move Higher?
Gold Price Outlook: Six-Month Time Frame – Log Scale
Source: TradingView
Key points from the six-month chart:
Gold is testing a breakdown below the 27.2% Fibonacci retracement of the 1920-2026 advance. A close below 3,930 would expose the 38.2% Fibonacci retracement near the 3,500-3,460 zone, which served as a five-month resistance area throughout 2025. Price action is also aligned with the trendline connecting consecutive highs between 2016 and 2025, a major resistance-turned-support level. This high-time-frame confluence zone could determine whether gold stages a major reversal or experiences a deeper decline. Gold Price Outlook: Daily Time Frame – Log Scale
Source: TradingView
Key points from this chart:
Despite the high-time-frame support confluence, gold's daily price action remains capped below a descending trendline connecting lower highs since March 2026, maintaining an overall bearish bias. Price action is currently holding a fragile rebound, testing the 27.2% Fibonacci retracement of the April-July decline. A move above 4,200 would shift focus toward: 4,300: 38.2% Fibonacci retracement. 4,420: 50% Fibonacci retracement, which would mark a sustained bullish shift from the current bearish bias. As long as DXY strength persists, as discussed in this video, downside risks remain elevated across both EUR/USD and gold unless a change in monetary policy direction is confirmed and/or key resistance levels are reclaimed.
Currencies Reflect Divergent Monetary Policies and Economic Fundamentals On July 13, the dollar, euro and pound will keep being defined by competing central bank stances and economic fundamentals. Latest FOMC meeting minutes saw a hint of a shift towards the hawkish side with some officials thinking rates might well be firmed up on the back of core inflation being too sticky, while risks from energy price volatility, and demand from artificial intelligence. The dollar is thus supported by the prospect of relatively restrictive monetary policy being sustained for a period of time. Strong underlying domestic demand and a status quo as a global reserve currency are key structural positives for the dollar.
Economy-wide growth across the euro zone is currently uneven, and is likely to remain so in the months following the ECB’s June rate increase to 2.25%. Different fiscal positions at the country level and heterogeneous inflation dynamics are key factors influencing monetary policy transmission in the euro zone. The euro currency remains susceptible to activity and wage data.
Sterling is facing a similar dilemma, as policymakers at the Bank of England juggle elevated service-sector inflation risks against signs of softer economic growth. Domestic fiscal and labour market policies are likely to continue playing a key role in the currency’s outlook as relative policy stances with the Fed and the ECB impact on exchange rates.
Key economic fundamentals remain divergent, with different paths in inflation dynamics, fiscal settings and underlying growth resilience, all of which will sustain two-way market risks for the three major currencies. External trade flows and capital movements will further differentiate the currency markets depending on which central bank can most easily maintain stability and growth.
DXY Holds $101.07 – Fib 0.618 Retest on 4h Dollar Index Price Chart – Source: Tradingview The USD index (DXY) was up slightly at $101.07 on the 4h timeframe chart. We can see from the 4h DXY chart that the mixed candles had just tested 0.618 Fib level near 100.31 after a strong breakout from the swing low at 97.67.
The bullish bodies with higher highs are confirming the buyer’s control, while still maintaining respect for the 4h chart 50-EMA near 101.02. We can also observe that the RSI sits near 55. Meanwhile, the volume profile identifies 100.59-101.06 as a significant breakout point.
Fib retracement implies the next resistance will come around 103.09 in the next few weeks. In short, the market remains decisively bullish in the 4h chart above 100.59 inside a well-defined ascending channel, confirming a higher high and a higher low formation to keep the buyers firmly in control.
Based on this technical outlook, I would consider a long position around $101.07, targeting $103.09, while placing a stop below $100.59.
GBP/USD Holds $1.3388 – EMA 50 Defense on 4h
GBP/USD Price Chart – Source: Tradingview The British pound was trading near $1.3388 on the 4h timeframe chart. The mixed candles defending the 4h chart 50-EMA near 1.3360 were kicked off near the red MA around 1.337, according to the 4h GBP/USD price chart.
The bullish wicks represent buyers’ absorption around support levels, confirming higher lows are still in tact. The RSI sits near 51. The volume profile identifies 1.331-1.338 as a reliable pivot. We note that the resistance is located around 1.345-1.350.
The GBP/USD is maintaining a neutral-to-bearish structure at the 4h 1.345 EMA-50 as the price oscillates inside a sideways trading range. The higher lows indicate that the buyers remain on the sidelines, looking to buy at any pullback.
Based on the current technical outlook, I would consider a long position around 1.3388, targeting 1.345, with a stop below 1.325.
EUR/USD Holds $1.1440 – EMA 50 Defense on 4h EUR/USD Price Chart – Source: Tradingview The euro (EURUSD) was trading near $1.1440 on the 4h timeframe chart. The 4h EUR/USD chart shows that the mixed candles are defending the 4h chart 50-EMA near $1.1423 after the bears were kicked off near the $1.162 red MA. We see that the bullish wicks represent buyers’ absorption near support levels while the higher lows are being held on the 4h EUR/USD.
The RSI sits near 43. The volume profile confirms a reliable pivot around 1.140-1.150. The next resistance is located around 1.155-1.162. The EUR/USD price action remains neutral-bearish near the 1.150 EMA-50 on the 4h timeframe chart as the price trades inside the long-term downtrend. Higher lows keep the buyers engaged, as they enter at any dips in this zone.
Based on the current technical outlook, I would consider a long position around 1.1440, targeting 1.155, with a stop below 1.140.
UOB’s Quek Ser Leang and Lee Sue Ann highlight that EUR/USD has slipped after testing 1.1460, with increasing downward momentum but major support at 1.1360 seen as difficult to reach near term. For the coming 1–3 weeks, they expect EUR/USD to remain in a 1.1360–1.1450 range. On a multi‑week view, a break of the 1.1390/1.1410 support zone would target 1.1210.
Euro seen confined in set band"24-HOUR VIEW: EUR rose to a high of 1.1449 last Thursday. When it was at 1.1430 on Friday, we highlighted the following: “The slight increase in upward momentum suggests EUR may retest 1.1450. A continued rise above this level is unlikely. Support is at 1.1420; a breach of 1.1405 would mean that the prevailing mild upward pressure has eased.” We were not wrong, as EUR rose to 1.1460 and then dropped back down to 1.1410. EUR closed at 1.1413, but it opened with a slight gap down this morning. While the increasing downward momentum suggests EUR could decline further, the major support at 1.1360 could be out of reach. Note that there is another support level at 1.1375. To sustain the downward momentum, EUR must hold below 1.1420, with minor resistance at 1.1405."
"Our most recent narrative was from last Thursday (09 Jul, spot at 1.1420), when we highlighted that EUR “has likely moved back into a range-trading phase, expected to be between 1.1360 and 1.1450.” After EUR rose to 1.1449, we highlighted on Friday that “although EUR subsequently rose to 1.1449, there has been no clear increase in upward momentum.” We also highlighted that “looking ahead, with momentum remaining flat, a break above 1.1450 is likely to result in a broader trading range rather than a sustained move higher.” Although EUR subsequently rose above 1.1450 with a high of 1.1460, it retreated from the high. The price action still appears to be part of a range-trading phase, and for the time being, we continue to expect EUR to trade between 1.1360 and 1.1450"
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
The Euro (EUR) holds opening losses at around 1.1390 against the US Dollar (USD) during the mid-Asian trading session on Monday. The major currency pair faces selling pressure as the US Dollar starts the week on a strong note due to an increase in the appeal of safe-haven assets.
At press time, the US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, trades 0.2% higher to near 101.15.
Escalating military actions between the United States (US) and Iran over Tehran showing dominance over the Strait of Hormuz, a critical chokepoint to almost 20% of global energy supply, have forced investors to shift to the safe-haven fleet and have de-anchored inflation expectations.
To get cues regarding the current status of US inflation, investors will pay close attention to the Consumer Price Index (CPI) data for June, which will be released on Tuesday.
This week, investors will also focus on Federal Reserve (Fed) Chair Kevin Warsh’s two-day testimony before Congress starting on Tuesday.
Technical Analysis:
EUR/USD trades lower at around 1.1390, keeping a bearish near-term tone as spot holds beneath the 20-period Exponential Moving Average (EMA) at 1.1443 and a breakdown of the Bearish Flag formation.
The Relative Strength Index (14) hovers near 38, hinting at persistent but not extreme downside momentum.
On the topside, initial resistance is aligned with the lower boundary of the parallel channel near 1.1424, followed by the 20-period EMA at 1.1443, with the channel top around 1.1530 acting as a stronger cap if a rebound extends. On the downside, major support levels are the June 24 low at 1.1324, followed by 1.1300.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Risk sentiment FAQs In the world of financial jargon the two widely used terms “risk-on” and “risk off'' refer to the level of risk that investors are willing to stomach during the period referenced. In a “risk-on” market, investors are optimistic about the future and more willing to buy risky assets. In a “risk-off” market investors start to ‘play it safe’ because they are worried about the future, and therefore buy less risky assets that are more certain of bringing a return, even if it is relatively modest.
Typically, during periods of “risk-on”, stock markets will rise, most commodities – except Gold – will also gain in value, since they benefit from a positive growth outlook. The currencies of nations that are heavy commodity exporters strengthen because of increased demand, and Cryptocurrencies rise. In a “risk-off” market, Bonds go up – especially major government Bonds – Gold shines, and safe-haven currencies such as the Japanese Yen, Swiss Franc and US Dollar all benefit.
The Australian Dollar (AUD), the Canadian Dollar (CAD), the New Zealand Dollar (NZD) and minor FX like the Ruble (RUB) and the South African Rand (ZAR), all tend to rise in markets that are “risk-on”. This is because the economies of these currencies are heavily reliant on commodity exports for growth, and commodities tend to rise in price during risk-on periods. This is because investors foresee greater demand for raw materials in the future due to heightened economic activity.
The major currencies that tend to rise during periods of “risk-off” are the US Dollar (USD), the Japanese Yen (JPY) and the Swiss Franc (CHF). The US Dollar, because it is the world’s reserve currency, and because in times of crisis investors buy US government debt, which is seen as safe because the largest economy in the world is unlikely to default. The Yen, from increased demand for Japanese government bonds, because a high proportion are held by domestic investors who are unlikely to dump them – even in a crisis. The Swiss Franc, because strict Swiss banking laws offer investors enhanced capital protection.
EUR/USD started a recovery wave and climbed to test 1.1450. A rising channel or a possible bearish pennant is forming with resistance at 1.1500 on the 4-hour chart. GBP/USD recovered and tested the 1.3450 resistance. WTI Crude Oil prices struggled to stay above $75.00 and trimmed gains. EUR/USD Technical Analysis The Euro recovered some losses and climbed above 1.1420 against the US Dollar. However, EUR/USD seems to be facing hurdles near 1.1475 and 1.1500.
Looking at the 4-hour chart, the pair failed to clear the 50% Fibonacci retracement level of the downward move from the 1.1622 swing high to the 1.1324 low. It also struggled to settle above the 100 simple moving average (red, 4-hour) and remained well below the 200 simple moving average (green, 4-hour).
If there is a fresh decline, the pair might find support near 1.1380. The first major support could be near 1.1350. A downside break and close below 1.1350 might send the pair toward 1.1325. Any more losses could open the doors for a test of 1.1280.
On the upside, the bears might remain active near 1.1475. The next major resistance might be 1.1500. There is also a rising channel or a possible bearish pennant forming with resistance at 1.1500.
A close above the channel resistance could decrease selling pressure. In the stated case, the bulls could aim for a move to 1.1580.
Looking at GBP/USD, the pair recovered some losses, tested the 1.3450 resistance, and now shows some signs of consolidation.
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The EUR/USD pair edges lower to around 1.1400 during the early Asian session on Monday, pressured by heightened geopolitical tensions in the Middle East. Federal Reserve (Fed) Bank Governor Christopher Waller and European Central Bank (ECB) policymaker Isabel Schnabel are set to speak later in the day.
The US military said that it launched another round of strikes at Iran over the weekend, per CNN. The Islamic Revolutionary Guard Corps (IRGC) then launched retaliatory drone and missile assaults on US allies across the Middle East, including Kuwait, Jordan and Qatar.
Iran’s Foreign Ministry on Sunday condemned US military attacks on Iran, accusing Washington of violating international law and warning neighboring countries not to assist any military action against the country. Another escalation in the diplomatic breakdown between the US and Iran could boost a safe-haven currency such as the Greenback and act as a headwind for the major pair.
Traders have ramped up their bets on ECB hikes again in recent days on signs that an agreement between Washington and Tehran to end the war is in jeopardy. The ECB raised the interest rates at the June policy meeting and markets expect it to do so twice more over the next year to contain the fallout from the Iran war on energy prices.
The US Consumer Price Index (CPI) inflation data will be published later on Tuesday. The headline CPI is expected to decline by 0.1% MoM in June, while the core CPI is projected to show a rise of 0.3% during the same period. Any signs of softening inflation in the US could reduce pressure on the Fed to hike interest rates, weighing on the USD.
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.
The EUR/USD ended the week on the back foot, surrendering its earlier poise during Friday’s session. From mid-week until that point, the pair had displayed a rather unexpected degree of composure, even as tensions in the Middle East flared up again. A sharp rebound in crude oil swiftly changed the market narrative by mid-week, herding investors back into cautious, defensive trades. By the final stages, however, the mood had darkened.
All eyes on US-Iran tensions again At the weekend, there was further escalation of tensions. The US initiated a new series of airstrikes in Iran after the IRGC forces targeted a vessel navigating the Strait of Hormuz. This strategic waterway, crucial for global oil shipments, has now been declared closed by IRGC until further notice, and launched attacks on American military bases and their regional allies.
Retaliation from Tehran was inevitable, and one can easily imagine the situation spiralling quite rapidly. Of course, rhetoric can soften. We’ve seen that movie before.
But for now, traders are forced to assume the worst. That means the dollar continues to benefit from its dual role as both a high-yielder and a safe harbour, while the euro—particularly vulnerable given Europe’s energy import dependency—remains on the back foot. Stagflation fears, never far from the surface, are once again creeping back into the conversation.
CPI and Warsh Take Centre Stage Geopolitics aside, this week’s calendar is anything but quiet. All eyes turn to Wednesday’s US CPI release and Fed Chair Kevin Warsh’s congressional testimony. With energy prices now firmly elevated, the inflation data takes on added significance. The risk skew is clearly tilted toward a hotter print, which would reinforce the narrative that the Fed may need to keep rates restrictive for longer—or even hike again later this year.
If that scenario plays out, expect US Treasury yields to push higher, further widening the interest rate differential that has been one of the dollar’s strongest pillars.
Technical EUR/USD outlook and levels to watch On the charts, the picture remains cautious. EUR/USD is carving out what looks increasingly like a bear flag on the daily timeframe—a continuation pattern that suggests the recent consolidation is just a pause before another leg lower.
Key levels to watch: Support: The 1.1400 zone remains the immediate line in the sand. A clean break below could open the door to 1.1300 fairly quickly. Resistance: On the upside, 1.1450 continues to cap rallies. A move above that would shift focus to 1.1500, with 1.1575 as the next meaningful hurdle. For now, the path of least resistance still points south.
The Bottom Line Unless we see a meaningful shift in the fundamental landscape—be it a sharp drop in oil prices, or a string of weak US data—the dollar’s yield advantage and safe-haven status are likely to keep any EUR/USD rallies well-contained. The near-term bias remains cautiously bearish, with geopolitics and inflation data set to dictate the next move.
The Euro to Dollar (EUR/USD) exchange rate is holding close to 1.1415, despite renewed geopolitical tensions in the Middle East that would normally be expected to support the US Dollar.
UniCredit believes the Dollar's muted response reflects a combination of higher global bond yields, resilient equity markets and fading expectations of an imminent Federal Reserve rate increase.
The bank identifies rising long-term yields outside the United States as the most important factor supporting the Euro.
According to UniCredit, higher German Bund and Japanese government bond yields are providing a "parachute" for other major currencies, reducing the Dollar's traditional safe-haven advantage during periods of geopolitical stress.
The bank also notes that minutes from the Federal Reserve's latest meeting remained cautious on inflation but stopped short of signalling an imminent interest-rate hike, while global equity markets have remained remarkably resilient.
UniCredit adds that investors have become increasingly accustomed to shifts in President Trump's rhetoric, making markets less likely to react aggressively to geopolitical headlines alone.
Even so, the bank does not expect a sustained Dollar sell-off until diplomatic progress resumes.
According to UniCredit, "a rapid move back above 1.15 in EUR-USD... appears unlikely" while negotiations between the US and Iran remain stalled. At the same time, the risk of EUR/USD slipping back towards the year's low near 1.1325 "has therefore not disappeared" if tensions escalate further.
The Euro to Dollar (EUR/USD) exchange rate is trading around 1.1415 after losing more than 2% during June and struggling to build a sustained recovery in July.
Goldman Sachs has lowered its six- and 12-month EUR/USD forecasts to 1.12, compared with previous targets of 1.18 and 1.20 respectively.
The bank expects a divided US Dollar environment, with the Greenback likely to strengthen further against lower-yielding currencies such as the Euro while losing ground against selected higher-carry currencies.
According to Goldman Sachs, the forecast revisions reflect an “ongoing divided Dollar environment” rather than an expectation of uniform Dollar gains across the foreign exchange market.
The bank expects US interest rates to remain at 3.50-3.75% for the rest of 2026, while resilient economic growth and persistent inflation should keep US yields relatively attractive.
Goldman Sachs forecasts US growth of 2.0% in 2026 and expects core PCE inflation to end the year at 3.0%, reducing the case for rapid Federal Reserve easing.
These conditions should continue to favour the Dollar against the Euro, with Goldman Sachs now expecting EUR/USD to fall towards 1.12 over both the six- and 12-month horizons.
The Euro to Dollar (EUR/USD) exchange rate has slipped back towards 1.1415 as investors continue to favour the US Dollar following resilient US economic data and expectations that the Federal Reserve will keep interest rates higher for longer.
HSBC believes EUR/USD is likely to face renewed downside pressure as markets shift their focus back to interest-rate differentials.
The bank notes that geopolitical concerns in the Middle East have eased, reducing one source of support for the Dollar. However, it argues that renewed disruption to shipping routes could quickly restore safe-haven demand for the US currency.
According to HSBC, firm US labour market conditions and sticky inflation continue to justify a cautious approach from the Federal Reserve, keeping longer-term yield support firmly behind the Dollar.
The bank also highlights that Eurozone inflation has cooled, but underlying price pressures remain elevated, leaving the European Central Bank in a difficult position.
HSBC argues that "the EUR loses out on fundamentals", with interest-rate differentials now re-emerging as the dominant driver of EUR/USD.
The bank adds that the outlook could deteriorate further if energy prices rise again, warning that renewed disruption in the Middle East would increase stagflation risks for the Eurozone and add fresh pressure on the single currency.
Euro Technical Outlook: EUR/USD Short-term Trade Levels EUR/USD is holding above a key support zone as with the July opening range carved just above. The broader April downtrend remains vulnerable while above support – risk for price inflection ahead. A break below support would reinforce the bearish outlook while a topside breakout would strengthen the case that a more significant low is in place. U.S. CPI and PPI data next week could provide the catalyst for the next directional move. Resistance 1.1483/92 (key), 1.1576/78, 1.1646/49- Support 1.1355/60 (key), 1.1276, 1.1214 EUR/USD continues to trade within an increasingly compressed range, with both the weekly and monthly opening ranges developing just above a major support zone. The repeated failure to break lower has left the April downtrend vulnerable near-term, while buyers still need a decisive breakout to suggest a more durable low is in place. With key U.S. inflation data due next week, the stage is set for a move that could determine the pair's next directional trend. Battle lines drawn on the Euro short-term technical charts.
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Euro Price Chart – EUR/USD Daily
Chart Prepared by Michael Boutros, Sr. Technical Strategist; EUR/USD on TradingView
Technical Outlook: In my last Euro Short-term Technical Outlook we noted that EUR/USD had rebounded nearly 1% off the June low and that, “From a trading standpoint, rallies would need to be limited to 1.1675 IF EUR/USD is heading lower on this stretch with a close below the weekly open needed to threaten another test of the monthly lows.” Euro broke sharply lower later that day with the decline extending more than 2.9% off the June high before rebounding off confluent support into the close of the month. The July opening range has been carved just above, and the focus is on a breakout in the days ahead with the April downtrend vulnerable while above this pivotal support zone.
Euro Price Chart – EUR/USD 240min
Chart Prepared by Michael Boutros, Sr. Technical Strategist; EUR/USD on TradingView
Notes: A closer look at Euro price action shows EUR/USD holding a tight range this week, just below the median line. Key support rests with the yearly low-day close (LDC) and the 38.2% retracement of the 2025 advance at 1.1355/60. A break / daily close below this threshold would mark a break of the monthly opening range and threaten resumption of the May downtrend toward subsequent support objectives at the 2023 high at 1.1275 and the 2024 high at 1.1214- both levels of interest for possible downside exhaustion / price inflection IF reached.
Resistance is eyed at 1.1483/92- a region defined by the 1.618% extension of the April decline and the November low-day close (LDC). Noe that channel resistance extending off the May high (red) converges on this level early next week and a breach / daily close above would be needed to validate a breakout of the July opening range and a suggest a more significant low is in place / a larger reversal is underway. Subsequent resistance objectives eyed at the May / January lows at 1.1576/78 and the 200-day moving average and the 61.8% retracement of the April decline at 1.1646/49.
Bottom line: The weekly opening range is preserved within the broader monthly opening range, just above support. Look for the breakout to offer guidance here in the days ahead. From a trading standpoint, rallies would need to be limited to 1.1492 IF price is heading lower on this stretch with a close below 1.1355 needed to fuel the next leg of the decline.
The focus next week shifts to the release of June U.S. inflation data, with the Consumer Price Index (CPI) due Tuesday and the Producer Price Index (PPI) on Wednesday. Following Chair Warsh's renewed commitment to restoring inflation to the Fed's 2% target, the reports will be closely watched for clues on the future path of U.S. monetary policy. A stronger-than-expected inflation reading would reinforce expectations for additional Fed tightening, supporting Treasury yields and the U.S. dollar while increasing downside risks for EUR/USD. Conversely, softer inflation data could temper expectations for further policy tightening, weighing on the greenback and providing scope for a broader recovery in the euro. Stay nimble into the releases and watch the weekly closes for guidance. Review my latest Euro Technical Forecast for a closer look at the longer-term EUR/USD trade levels.
Key EUR/USD Economic Data Releases
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Societe Generale’s Kenneth Broux notes EUR/USD has rebounded after forming an interim low near 1.1325 and moved back into its prior range, signalling limited follow-through on the earlier breakdown. The bank stresses that resistance at 1.1475/1.1500 must be cleared to extend the bounce, while a drop below 1.1390 would risk resuming the broader downtrend.
Bounce capped by 1.1500 barrier"EUR/USD has staged a modest rebound after carving out an interim low around 1.1325. The pair has re-integrated within previous range, indicating a lack of follow-through after the recent breakdown."
"However, clear signals of a large up move are not yet visible. The recent pivot high at 1.1475/1.1500 is the first layer of resistance. Overcoming this will be crucial for signalling an extension of the bounce."
"Conversely, there could be a risk of a continuation of the downtrend if the pair breaches the recent pivot low at 1.1390."
"Euro bid for second day as dust settles around oil prices. Support 1.1390, resistance 1.1500. Massive option expiries at 1.1370-85 (€1.3bn), 1.1400-50 (€6.5bn). US CPI, PPI, Warsh semi-annual testimony next week."
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The Euro to Dollar (EUR/USD) exchange rate has edged higher to around 1.1450, extending its recovery from this week's lows as the US Dollar softened modestly.
UOB believes the Euro retains a mild upside bias in the near term, although it expects gains to be capped around the 1.1450 level.
The bank notes that upward momentum has improved slightly after EUR/USD rebounded from 1.1390 earlier this week.
According to UOB, "EUR may retest 1.1450", but it cautions that "a continued rise above this level is unlikely."
Looking beyond the next 24 hours, UOB believes the pair has returned to a range-trading phase after failing to generate stronger bullish momentum.
The bank expects EUR/USD to trade between 1.1360 and 1.1450 over the coming one to three weeks, adding that even a break above resistance would probably lead to a broader trading range rather than a sustained rally.
UOB continues to monitor the 1.1390-1.1410 support zone closely. The bank maintains that if this area eventually gives way, the next medium-term downside target remains 1.1210.
MUFG’s Derek Halpenny highlights that European Central Bank (ECB) minutes added little new information but confirmed openness to another rate hike, consistent with MUFG’s call for a 25bp move in September. Despite the Euro being July’s weakest G10 currency, a turning 2-year yield spread and potential US yield declines could support renewed EUR/USD upside in coming weeks.
ECB stance and yields guide Euro outlook"The ECB will be certainly less concerned over longer-term inflation expectations becoming un-anchored with the 5y5y inflation swap rate having declined since the initial ceasefire was agreed."
"If crude oil and/or natural gas prices were to rebound sharply then risks will rise of course but at this point longer-term inflation expectations remain well anchored."
"In that context we see continued risks of the ECB acting again consistent with our current forecast of another 25bp hike in September."
"The euro is currently the worst performing G10 currency in July but the 2-year yield spread has started to turn in favour of some moderate EUR/USD recovery."
"We continue to see risks of US yields turning lower that should reinforce renewed upward momentum for EUR/USD."
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The euro has also been struggling to navigate mixed economic activity throughout the Eurozone, and in addition, the ECB is trying to achieve price stability. As countries continue to have varying fiscal positions and inflation rates, they are impacting the way that monetary policy affects each country differently. For the euro, that translates into being vulnerable to data releases on economic activity and wage increases.
Sterling faces the same challenge of balancing between the Bank of England’s concerns over services inflation and the economy’s slowing pace. In the UK, there continues to be domestic fiscal policy and labor markets that will remain important factors in the pound’s performance. On top of that, policy decisions of the other two central banks will impact the currency pair prices.
These currencies’ fundamentals reflect that their divergence is going to remain intact for some time to come. Inflation levels, fiscal policy choices, and economic growth vary from country to country in terms of pace and resilience. As a result, two-way risks remain prevalent in these currencies and will persist. These countries’ differences will play out in the currencies’ trade balances and capital movements, in addition to the central banks’ capabilities to stabilize growth.
ING’s Francesco Pesole writes that Middle East tensions have modestly re-tightened EUR/USD short-term swap rate differentials by around 10bp, though the spread remains wider than pre-war levels. While this supports expectations for a potential September European Central Bank (ECB) hike, Pesole argues the path for a stronger EUR/USD is limited and warns of downside risks, including a possible retest of 1.140.
Rate spreads support but risks linger"We expect stabilisation today – with markets potentially wanting to wait for weekend clarity – but risks are of a retest of 1.140."
"While all this is injecting new confidence into previously dwindling expectations for a September ECB hike, the path for EUR/USD to come out stronger from this re-escalation is quite narrow."
"The Middle East military re-escalation has prompted a moderate re-tightening in EUR/USD short-term swap rate differentials. In the two-year tenor (often the best correlated with FX moves), that has been worth roughly 10bp."
"That spread is still 50bp wider than its April peak, when markets bet heavily on ECB tightening but not on the Fed’s, but only 15bp wider than before the war."
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UOB’s Quek Ser Leang highlights a modest uptick in EUR/USD momentum, with scope to retest 1.1450 but limited prospects for a sustained break higher. Intraday support is seen at 1.1420 and 1.1405. For the coming one to three weeks, the pair is viewed in a 1.1360–1.1450 range, while a break of 1.1390/1.1410 could expose 1.1210 longer term.
Euro capped near recent highs"24-HOUR VIEW: EUR declined to 1.1390 two days ago before recovering to close largely unchanged at 1.1414 (+0.03%). Yesterday, we noted that “momentum indicators are turning flat,” and we held the view that EUR “is likely to range-trade between 1.1395 and 1.1440.” EUR subsequently traded within a higher range of 1.1412/1.1449, closing at 1.1428 (+0.12%). The slight increase in upward momentum suggests EUR may retest 1.1450. A continued rise above this level is unlikely. Support is at 1.1420; a breach of 1.1405 would mean that the prevailing mild upward pressure has eased."
"1-3 WEEKS VIEW: Yesterday (09 Jul, spot at 1.1420), we highlighted that EUR “has likely moved back into a range-trading phase,” and we expected it “to trade between 1.1360 and 1.1450.” Although EUR subsequently rose to 1.1449, there has been no clear increase in upward momentum. Looking ahead, with momentum remaining flat, a break above 1.1450 is likely to result in a broader trading range rather than a sustained move higher."
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The EUR/USD pair attracts some buyers for the third consecutive day and touches a fresh weekly high, around the 1.1460 area, during the Asian session on Friday. The US Dollar (USD) is seen prolonging the less hawkish FOMC Minutes-inspired slide and turning out to be a key factor acting as a tailwind for the currency pair. However, persistent geopolitical uncertainties help limit further USD losses and cap spot prices.
From a technical perspective, the EUR/USD pair, so far, has been struggling to find acceptance or build on its strength beyond the 23.6% Fibonacci retracement level of the April-June downfall. Moreover, the recovery from the year-to-date low has been along an upward-sloping channel, which now seems to constitute the formation of a bearish flag pattern, leaving the recent gains capped within the broader corrective structure.
Momentum indicators, however, remain constructive. In fact, the Relative Strength Index is hovering just below 60, while the Moving Average Convergence Divergence (MACD) line is above zero and showing a modestly positive histogram. This suggests downside pressure is limited while the EUR/USD pair stays supported by the trend-channel support, currently pegged near the 1.1400 mark, which should act as a pivotal point.
A convincing breakdown below the said handle would expose the deeper structural supports clustered near 1.1327–1.1323. On the topside, immediate resistance is seen at the 200-period EMA at 1.1491, followed closely by the channel top at 1.1494. A sustained strength and acceptance above this zone would open the way toward the 38.2% retracement at 1.1524 and the 50.0% level around 1.1586, if the bullish momentum extends further.
(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.
RaboResearch Global Economics & Markets discusses how Euro sentiment has cooled after optimism around Germany’s debt brake, with political risks and structural headwinds weighing on the currency. The bank notes EUR/USD is already priced for another ECB hike and expects sideways trading near current levels in the coming months, with only a modest upward bias further out.
Euro sentiment cools after 2025 surge"While higher short-term interest rates are currency supportive, the market is already fully priced for another ECB rate hike this year, suggesting that one more policy move is unlikely to offer much support for the EUR. On balance, we expect EUR/USD to trade sideways close to current levels on a 1-to-3-month view."
"Irrespective of this, it is worth noting that the EUR was the second best performing G10 currency in Q2 2025 after the safe haven CHF. This highlights the part the EUR played in emphasising the sharp rise in the EUR/USD in that period."
"The EUR now appears to have lost that momentum and that has clear implications for the outlook for EUR/USD."
"In our view, the market is likely to be reluctant to rebuild large, long positions in the EUR in the months ahead. That said, while the USD has benefited from a resilient US economy, it is RaboResearch’s view that hawkish bets on the Fed are overdone."
"We expect sideways trading in EUR/USD on a 3-month view and a modest upward bias to emerge in the currency pair on a 3-to-6-month view."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
The Euro to Dollar (EUR/USD) exchange rate has steadied near 1.1425 after recovering from June's lows, although Rabobank believes the single currency has lost much of the momentum that drove its rally earlier this year.
The bank expects EUR/USD to trade broadly sideways over the next one to three months before regaining a modest upward bias later in the year.
Rabobank argues that optimism surrounding Germany's decision to loosen its debt brake has faded as investors refocus on weaker Eurozone growth, higher energy costs and lingering competitiveness challenges.
According to the bank, last year's fiscal shift in Germany "was no panacea", with structural reforms still needed to tackle sluggish productivity and weak long-term growth.
Rabobank also notes that markets are already fully priced for another European Central Bank rate increase this year, limiting the Euro's ability to gain further support from monetary policy.
While the US Dollar continues to benefit from a resilient economy, the bank believes expectations for additional Federal Reserve tightening have become excessive and should gradually unwind.
Even so, Rabobank expects investors to remain reluctant to rebuild large long Euro positions in the coming months after the currency's strong performance over the past year.
The bank believes investors will remain cautious in the near term. According to Rabobank, "the market is likely to be reluctant to rebuild large, long positions in the EUR in the months ahead."
However, it also argues that expectations for further Federal Reserve tightening have become excessive. As the bank puts it, "we expect sideways trading in EUR/USD on a 3-month view and a modest upward bias to emerge in the currency pair on a 3-to-6-month view."
Chris Turner at ING highlights that EUR/USD has held up despite higher Oil, as Euro swap rates outperformed US rates on expectations of an ECB hike in September. However, he argues the Fed narrative will dominate, with EUR/USD likely to surrender gains and fall below 1.14. ECB minutes and energy prices should keep September hike expectations alive.
Resilience questioned as Fed dominates"On the eurozone calendar today is the release of the ECB minutes for the 11 June meeting. We assume this will be pitched as hawkish and, combined with higher energy prices, keep expectations alive for a follow-up hike at the September meeting. That is currently priced at +22bp by money markets."
"EUR/USD has held up remarkably well given the jump in oil prices yesterday. Yield spreads did narrow in favour of the euro, where euro swap rates rose around 7-8bp more than short-dated US rates on the view that the ECB is more likely to pull the trigger on another hike in September."
"However, we think the Fed story will be a more dominant theme and can easily see EUR/USD handing back early gains today and sending the euro back below the 1.14 level."
"Could some of the EUR/USD resilience be down to President Trump mentioning Greenland again at the NATO conference? Remember that his threats back in January sparked a backlash against US asset markets from European investors. This link looks tenuous at best."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
HomeTechnical AnalysisIntraday Analysis 09.07.2026 Nasdaq continues selling off
Intraday analysis covering EURUSD(The euro) , AUDUSD , and NAS 100, highlighting recent price movements, key technical levels, and short-term momentum shifts across major markets.
EURUSD remains undecided
EURUSD(The euro) took a break from moving towards more multi-week highs but remains bullish.
The pair has been inching higher and lower since last Friday’s NFP data, which saw a decline in job numbers. 1.1430 is the first hurdle for bulls on the path higher. As the RSI ventures away from the overbought area, the recent bottom could serve as firm support at 1.1340. 1.1550 is the next key level should a bullish extension ensue. AUDUSD stays congested
The US dollar continues to gain traction across the board as risk appetite remains heightened.
The current rebound from the 0.6960 top has kept momentum to the downside. Now that buyers are seemingly out of the picture, the path is mostly clear for a move lower towards 0.6865. However, a push above the latest resistance could lead to another rally, with 0.7000 becoming a psychological resistance. NAS 100 hits another low
The Nasdaq remained pressured after global indices fell lower with fresh attacks in the Middle East.
On the chart, the price is moving towards 28400 as bearish momentum attracts sellers. However, a bullish RSI divergence could indicate a deceleration in the downward spiral and might lead to a pullback if traders begin to close positions. 30000 is the closest resistance at the recent gap, and its breach would send the index towards 30800 to claim another record.
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The British currency has also been grappling with services inflation pressures and slower growth rates that the Bank of England has had to consider. Domestic budget spending and employment developments are crucial to the performance of the pound along with relative policy settings that can affect cross-rates with the U.S. and Europe.
Other factors, such as differential inflation paths, fiscal policies, economic growth levels, trade balances, and capital flows, can continue to drive currency valuations. As central banks respond to inflation pressures, their approaches will shape future developments in the FX markets. For now, the FOMC minutes released today, along with the upcoming data, provide additional market intelligence and could be a determining factor in shaping the trend that currencies are expected to move over the short term.
Thu Lan Nguyen at Commerzbank notes that EUR/USD has traded in a narrow range and appears largely unaffected by Iran-related headlines, as the correlation with Oil has weakened. She highlights that markets now price Fed rate hikes despite softer labour data, reflecting a hawkish FOMC bias and reduced perceived risk of politically driven monetary easing in the United States.
Fed reaction function supports Dollar"EUR/USD appears largely unaffected by the latest developments in the Iran conflict and continues to trade in a relatively narrow range. We had already pointed out that the correlation between the exchange rate and the oil price has diminished significantly."
"In other words, the market is now pricing in Fed rate hikes even in spite of a marked decline in oil prices."
"The fact that rate-hike expectations in the market are nevertheless holding up is mainly linked to a general reassessment of the Fed’s reaction function. And this can be traced back to the latest FOMC meeting, the first under the leadership of new Fed Chair Kevin Warsh which highlighted two points:"
"A significant number of FOMC members have a bias towards rate hikes. This was confirmed once again by the minutes of the meeting published yesterday evening, which state "Participants generally assessed that information received over the intermeeting period suggested that upside risks to price stability remained elevated while downside risks to achieving maximum employment had moderated a bit." as well as "In such scenarios [of elevated inflation], almost all of these participants indicated that some policy firming would likely be warranted to return inflation to 2 percent."."
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United Overseas Bank’s (UOB) Quek Ser Leang highlights that EUR/USD momentum has flattened, with the Euro expected to trade between 1.1395 and 1.1440 intraday. Over 1–3 weeks, the pair is seen in a broader 1.1360–1.1450 range-trading phase. On a 1–3 month view, a break of the 1.1390/1.1410 support zone would target 1.1210.
Euro-Dollar locked in range phase"24-HOUR VIEW: EUR fell to a low of 1.1407 on Tuesday. Yesterday, we highlighted the following: “Despite the relatively sharp decline, downward momentum has not increased much. However, there is scope for EUR to dip below 1.1390. The major support at 1.1360 is unlikely to come into view. Resistance is at 1.1420; a breach of 1.1430 would indicate that the immediate downward pressure has eased.” EUR subsequently declined and printed a low of 1.1390 before recovering to close largely unchanged at 1.1414 (+0.03%). Momentum indicators are turning flat, and today, we expect range-trading, most likely between 1.1395 and 1.1440."
"1-3 WEEKS VIEW: Last Friday (03 Jul, spot at 1.1430), we highlighted that “the bias for EUR is tilted to the upside.” After EUR fell sharply two days ago, we highlighted yesterday (08 Jul, spot at 1.1405) that “upward momentum has largely faded, and EUR has likely moved back into a rangetrading phase, and we expect it to trade between 1.1360 and 1.1450 for now.” There is no change in our view."
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Fresh US strikes reignite Hormuz disruption fears Europe's energy vulnerability back in focus Euro and European cyclicals resume underperforming Bearish wedge points to renewed downside risk Back to pricing energy risk The US has resumed strikes on Iran after attacks on commercial shipping transiting the Strait of Hormuz, raising the prospect that markets may once again have to price the risk of prolonged disruption to one of the world's most important energy chokepoints.
As Donald Trump declares the memorandum of understanding signed only weeks ago between the US and Iran "over", so too may be the brief respite for the euro, reviving simmering fears over energy security.
While it's too early to know whether the Strait will face prolonged disruption, the prospect alone is enough to remind investors that the region remains far more exposed to Middle Eastern energy shocks than the United States.
Even if higher energy prices increase the odds of another ECB rate hike later this month, the potential hit to growth may prove the more important driver, tilting the balance of risks for the euro and European assets to the downside, as shown in the chart below.
Europe left behind
Source: TradingView
The left-hand panel tracks EUR/USD since the Friday before the initial US strikes on Iran in late February. Alongside it is the performance of Euro Stoxx 600 futures relative to Russell 2000 futures over the same period. The latter were chosen because both are broader, more cyclical equity benchmarks, avoiding the outsized influence that mega-cap tch companies exert on US indices such as the S&P 500 and Nasdaq.
Since the conflict began, the euro has weakened while European equities have generally underperformed comparable US peers. To be sure, geopolitics is far from the only driver behind that divergence, but Europe's greater reliance on imported energy makes it far more vulnerable, impacting economic sentiment and capital flows.
However, while Trump's declaration that the MOU is "over" has revived geopolitical risk, traders are unlikely to price in the worst case scenario immediately. Throughout the conflict, markets have repeatedly lurched between reports of imminent de-escalation and renewed hostilities, whether from Trump himself or sources familiar with the negotiations.
The prolonged whipsawing may temper any immediate knee-jerk reaction, with trader instead likely to demand clearer evidence that the latest escalation will have a lasting impact on energy supplies and European economy. Rather than a single sharp move, EUR/USD may instead be vulnerable to a gradual grind lower, punctuated by bouts of volatility as markets once again find themselves playing headline hockey.
Technicals and fundamentals align
Source: TradingView
When you zoom out, the price action continues to favour the bears with EUR/USD carving out a series of lower highs and lower lows. It also remains beneath its key medium and longer-term moving averages, all of which are now starting to roll over and carry a negative slope.
And when you zoom in, the price appears to be sitting in what resembles a rising wedge, a pattern typically associated with bearish continuation. Admittedly, the structure isn't the cleanest, but a sustained break beneath wedge support would increase the risk of a retest of the lows set in June, and potentially an extension of the broader bearish trend.
If that scenario were to unfold, the first level to watch is the 38.2% Fibonacci retracement of the April 2025 advance at 1.1355, followed by the June 24 swing low at 1.1325. Should that latter level give way, there's not a lot of meaningful technical support to speak of until 1.1200, an area that repeatedly influenced price action following the Liberation Day tariff announcement in April 2025.
On the topside, the pair has repeatedly struggled above 1.1450, with another minor resistance zone sitting around 1.1480. Above there, 1.1500 and 1.1566 are the levels to watch.
The story from the oscillators is one of diminishing downside strength, not building upside momentum. RSI has lifted from oversold territory but, at around 42, remains below the midpoint and looks close to breaking the very shallow uptrend it's been sitting in over recent weeks. MACD has crossed above its signal line, but that merely suggests downside momentum has eased rather than been eradicated altogether. For now, that continues to favour selling into strength.
EUR/USD holds firm on Wednesday after reversing earlier losses triggered by renewed tensions between the United States (US) and Iran, while traders digest the June Federal Open Market Committee (FOMC) meeting minutes. At the time of writing, the pair is trading around 1.1427 after hitting an intraday low of 1.1391.
The US Dollar (USD) saw little immediate reaction to the minutes, suggesting much of the Federal Reserve's (Fed) message was already reflected in market pricing. The US Dollar Index (DXY), which tracks the Greenback's value against a basket of six major currencies, is trading around 100.97, easing from an intraday high of 101.27.
Officials remained cautious about inflation, which remains well above the central bank's 2% target, while describing labor market conditions as balanced.
Policymakers also signaled that the future path of interest rates will depend on incoming economic data, with some indicating that additional policy tightening could be warranted if inflation proves more persistent than expected.
Nevertheless, renewed geopolitical tensions and expectations that the Fed could deliver at least one interest rate hike this year should continue to underpin the Greenback, keeping downside pressure on EUR/USD.
Technical analysis:
On the daily chart, EUR/USD is trading within a downward parallel channel and beneath its key moving averages, which keeps the near-term bias bearish.
However, momentum is showing signs of improvement, with the Relative Strength Index (RSI) recovering to 41 from near-oversold territory, while the Moving Average Convergence Divergence (MACD) has turned marginally positive, reinforcing the idea of a consolidative phase within a broader downside structure rather than a clear bullish reversal.
On the topside, initial resistance is seen at the horizontal level around 1.1500, closely aligned with the upper boundary of the descending channel, forming a tight cap on any corrective bounce.
Above these, the 100-day Simple Moving Average (SMA) at 1.1611, followed by the 200-day SMA at 1.1649, represent more substantial barriers that would need to be reclaimed to ease the prevailing bearish tone.
On the downside, immediate support emerges at the horizontal level near 1.1350, ahead of the channel floor around 1.1305, where a break would likely open the way for a continuation of the broader downtrend.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
ABN AMRO’s Georgette Boele notes that the Euro’s relationship with energy prices has evolved, with recent Oil and Gas gains again weighing on EUR/USD. Earlier in the US-Iran conflict, higher energy prices hurt the Euro (EUR), but later the pair became more driven by Federal Reserve (Fed) and European Central Bank (ECB) expectations. She now sees EUR/USD guided by central bank expectations, yield spreads and Eurozone energy risks.
Euro sensitivity returns to energy moves"At the start of the US-Iran conflict, higher energy prices weighed on the euro against the US dollar. During the conflict, however, EUR/USD became less sensitive to energy prices and more sensitive to expectations for the Fed and the ECB."
"When a Memorandum of Understanding was announced, energy prices fell sharply, but the euro gained little against the US dollar because markets were focused on expectations of Fed rate hikes."
"As a result, oil and gas prices rose strongly, supporting the currencies of energy exporters such as the Norwegian krone, Canadian dollar and US dollar. At the same time, currencies of energy importers weakened."
"The euro again declined against the US dollar as energy prices rose."
"Going forward, the direction in EUR/USD will depend on expectations for the Fed and the ECB, inflation expectations, changes in nominal and real yield spreads between the US and Europe, and perceptions of possible energy shortages in the eurozone."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
