Over the past 24 to 48 hours, the EUR/USD pair has shown clear signs of softness, slipping below the 1.1750 level and continuing a slight downtrend from yesterday’s closing price of 1.17463. This decline was primarily driven by the release of Federal Reserve minutes, which highlighted the Fed’s firm stance on inflation control and suggested that monetary tightening may persist, strengthening the US Dollar and weighing on the Euro.

Coupled with better-than-expected US economic data, the US dollar index edged higher, reinforcing the dollar’s strength and adding downward pressure on EUR/USD. Though year-end thin liquidity has dampened volatility, the dollar’s resilience led to selling pressure around the 1.1745 mark on the Euro. For the average investor, this indicates robust US economic fundamentals and a determined Fed policy stance boosting dollar appeal, suggesting a short-term downside risk for the Euro versus the Dollar.

Looking ahead, markets will keep a close eye on Fed developments and economic data releases, as uncertainty remains over the Euro’s ability to recover amid expectations of a US economic slowdown in early 2026.

Daily Chart

The daily chart shows a continued downward trend in EURUSD after reaching near the yearly high of 1.19. Prices hover above key 50-day and 200-day moving averages, indicating a medium to long-term bullish bias remains, but short-term corrections are evident. Bollinger Bands are narrowing, suggesting reduced volatility, with price gravitating toward the lower band, indicating tentative support. MACD is widening in the negative zone, signaling increasing bearish momentum and potential sustained pressure. Overall, the trend appears in a technical correction phase, and traders should watch critical support levels closely for potential rebounds.

1H Chart

On the hourly chart, EURUSD exhibits a distinct short-term downtrend over the last 3 to 5 days. The MACD has formed a bearish crossover, trading volumes have declined before a slight bounce occurred. Bollinger Bands open downward, confirming the bearish trend. A nascent head and shoulders pattern is forming; a break below the neckline could trigger accelerated declines. The immediate focus is on whether price holds above the 1.1740 support and the 200-period moving average, with caution warranted if these are breached.

Technical Trend:  The current EURUSD trend is cautiously bearish, representing a ‘guarded downtrend’ phase. The market leans toward dollar strength with the price maneuvering through a technical adjustment and testing of critical levels, requiring close watch for breakout cues.

Technically, EURUSD faces pronounced selling pressure, with a developing head and shoulders pattern indicating increased risk of trend reversal. The MACD bearish crossover is widening, and RSI is approaching oversold territory, suggesting a short-term bounce may occur. However, the key resistance levels must be tested to confirm if a reversal attempt fails. The Bollinger Bands’ lower band pressure points to emerging support. Combining the fundamental dollar strength with Fed hawkish tones, traders can seek buy setups near strong support or consider short entries if resistance levels hold firm.

Today’s GMT+1 economic calendar highlights several key releases relevant to EURUSD, including Spain’s Consumer Price Index, Retail Sales, and Unemployment Rate. CPI data slightly beat forecasts, and retail sales showed robust growth, signaling resilience in the Eurozone. However, an uptick in unemployment adds some uncertainty. Meanwhile, US data such as the Chicago PMI and House Price Index have outperformed expectations, supporting the US dollar. Overall, today’s economic data are likely to continue favoring the dollar, exerting downward pressure on EURUSD. Traders should closely monitor the evolving economic differentiation between the US and Europe.

Resistance & Support

The above financial market data, quotes, charts, statistics, exchange rates, news, research, analysis, buy or sell ratings, financial education, and other information are for reference only. Before making any trades based on this information, you should consult independent professional advice to verify pricing data or obtain more detailed market information. 1uptick.com should not be regarded as soliciting any subscriber or visitor to execute any trade. You are solely responsible for all of your own trading decisions.