Over the past 24 to 48 hours, EUR/USD has shown notable volatility, rebounding more than 150 pips from yesterday’s close at 1.16181. The main driver behind this price action is the noticeable easing of geopolitical tensions, especially with the situation in the Middle East calming down. This eased pressure on the US dollar, allowing the euro to rally to around 1.18289, significantly above the prior day’s low of 1.16029.

This euro rebound reflects the market’s reaction to cooling inflation in the Eurozone alongside the ongoing divergence between the Federal Reserve and the European Central Bank monetary policies. For the average investor, it’s like navigating a bumpy market road: when geopolitical risks temporarily subside, the euro finds a momentary safe harbor and gains speed. Earlier, heightened Middle East conflicts had strengthened the dollar and pushed EUR/USD below the crucial 1.1600 psychological level. The recent de-escalation thus offered a clear rebound opportunity.

Looking ahead, market participants are closely watching upcoming US Non-Farm Payroll data, which could become the next major catalyst impacting EUR/USD’s direction. The strong bounce back signals investors’ hope for a more stable trend, but caution remains key as any sudden geopolitical or economic data shifts could quickly alter the current momentum.

Daily Chart

The daily chart shows EURUSD trading in a broad range between 1.15 and 1.20 since the start of the year. After recent gains above the psychological 1.1600 level, the pair has yet to confirm a clear trend reversal. The 50-day moving average near 1.17715 remains above the 200-day moving average at 1.16889, marking resistance zones. Bollinger Bands have narrowed, indicating reduced volatility but possible upcoming breakout. The MACD oscillates near the zero line, reflecting indecision and a tug-of-war between bulls and bears. Overall, the daily trend remains cautious and range-bound, awaiting stronger economic cues.

1H Chart

The hourly chart over the past 3-5 days reveals increased short-term momentum. The pair has rebounded from just below 1.1600, crossing short-term moving averages and approaching the 1.1850 resistance level. RSI is steady around 60, reflecting moderate bullish momentum. The MACD shows a recent bullish crossover from a low level, signaling upward momentum. Bollinger Bands have started to widen slightly, suggesting more volatility ahead. The technical setup indicates a positive short-term bias with a focus on whether the 1.1850 resistance can be broken convincingly.

Technical Trend:  EURUSD currently exhibits a cautious rebound trend, characterized by consolidation with a slight upward bias. Market sentiment has stabilized due to easing geopolitical risk, but solid US fundamentals limit sustained euro gains, resulting in a volatile sideways pattern.

Technically, EURUSD is at a critical juncture. The daily Bollinger Bands tightening and MACD hovering near zero suggest unresolved trend direction. On the hourly chart, increased momentum is evidenced by a MACD bullish crossover and an RSI around 60, which are positive short-term signs. The key support at 1.1578 is crucial to defend; a break below could accelerate declines. Resistance lies in the 1.1850-1.1900 zone, where a successful breakout could trigger renewed upside momentum. Traders should closely monitor price behavior at these levels to gauge the next directional move.

Today’s economic calendar includes key Eurozone and US releases. Germany’s Consumer Price Index is forecast to fall to 1.9% year-on-year from 2.1%, indicating easing inflation pressure—a potential headwind for EURUSD. The US CPI figures later today are expected to be largely in line with estimates. If US inflation data meets or exceeds expectations, the dollar may strengthen further, putting downside pressure on EURUSD. ECB member de Guindos’ speech also bears watching for any hawkish cues. Overall, no direct blockbuster events today but inflation data and central bank comments remain important for short-term EURUSD direction.

Resistance & Support

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