Over the past 24 to 48 hours, the EUR/USD currency pair bounced slightly after hitting a monthly low. It dipped to an intraday low near 1.13532 before recovering to around 1.14034, a modest rise from yesterday’s closing price of 1.1391. This price action highlights the overall strength of the US dollar, as the euro faced sustained bearish pressure despite the brief rebound.

The dollar’s strength is mainly driven by elevated US interest rates and geopolitical tensions in the Middle East, which have pushed investors towards the safety of US dollar assets amid increased risk aversion. Under such conditions, the euro remains under clear selling pressure, limiting EUR/USD’s upside potential. Furthermore, the European Central Bank’s decision to hold rates steady has curbed bullish momentum, contributing to a cautious market sentiment.

For the average investor, this means that during times of global uncertainty or geopolitical risks, capital often flows into the US dollar as a safe haven. Even if the Eurozone’s economic outlook looks stable, the interest rate advantage and safe-haven status of the dollar currently weigh on the euro, keeping EUR/USD volatile and anchored at lower levels. Investors should closely watch upcoming US economic data and ECB policy cues, as these will directly influence market confidence and currency movements.

Daily Chart

The daily chart shows a prevailing downtrend with a recent bounce near the monthly low. Price remains below the 50-day and 200-day moving averages, signaling that longer-term bearish pressure is intact. Bollinger Bands are tightening, indicating reduced volatility. The MACD is still below the zero line but flattening, reflecting some easing of selling pressure without clear bullish momentum yet. Overall, the daily trend remains bearish with interim support.

1H Chart

The hourly chart over the last 3–5 days displays a short-term rally within a consolidative range. The 20-period EMA has recently crossed above the 50 EMA, hinting at a nascent bullish momentum. Price is hovering near the Bollinger Bands’ middle line, while MACD shows strengthening bullish momentum and RSI rebounds from oversold to above 50. This suggests the short-term momentum is improving but key resistance levels remain to be tested.

Technical Trend:  The current trend is best described as cautiously consolidative with an overall bearish bias. Despite short-term price recovery attempts, USD strength continues to cap gains on EURUSD. Traders should view the market as range-bound with a bearish undertone until definitive breakout or breakdown occurs.

Technically, EURUSD has formed a potential expanding wedge pattern near the monthly low, indicating price compression and possible breakout zones. A recent daily candlestick engulfing pattern with a long upper wick suggests some short-term buying interest, though volume and momentum indicators like MACD have yet to confirm a trend reversal. A decisive break above the 1.1420 resistance could open the door for more upward price action, while failure to hold above 1.1350 risks resumption of the downtrend.

Today’s key economic data include Sweden’s Q2 seasonally adjusted GDP forecasted at 0.7% q/q and Germany’s import prices for June expected at 6% y/y. Australia releases CPI data for June and Q2 which may influence risk sentiment but have limited direct impact on EURUSD. The major focus remains on the US later in the day with the FOMC interest rate decision and press conference. These events will directly impact the US dollar and consequently the EURUSD price action. No major eurozone data are set for release, so the dollar remains the central driver.

Resistance & Support

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