Bullish view
- Buy the EUR /USD pair and set a take-profit at 1.2100.
- Add a stop-loss at 1.1800.
- Timeline: 1-2 days.
Bearish view
- Sell the EUR/USD pair and set a take-profit at 1.1800.
- Add a stop-loss at 1.2100.
The EUR/USD exchange rate rose to the important resistance level at 1.2000 for the first time in years after the Federal Reserve delivered its first interest rate decision of the year. It was trading at 1.1950 on Thursday morning, a few points below this week's high of 1.2087.
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Federal Reserve Interest Rate Decision
The EUR/USD pair rose and then pulled back after the Federal Reserve delivered its first interest rate decision of the year.
In a statement, the bank did what most analysts were expecting. Officials decided to leave interest rates unchanged between 3.50% and 3.75% after delivering three cuts in the previous three consecutive meetings.
Officials noted that time was on their side as the economy was doing relatively well. A recent report showed that the economy expanded by 4.4% in the third quarter, much higher than what analysts were expecting.
Stephen Miran and Christopher Waller were the only dissenters in this meeting as they voted to cut interest rates by 0.25%.
Looking ahead, the next key catalyst for the EUR/USD exchange rate will be key macro data from the United States. Economists expect the upcoming data to show that the US trade deficit continued narrowing, moving from $40 billion in October to $29 billion in November. The US will also publish the latest initial and continuing jobless claims data.
Meanwhile, the European Union will publish some key data in the morning session. The bloc will publish the latest consumer and business confidence reports.
EUR/USD Technical Analysis
The daily timeframe chart shows that the EUR/USD exchange rate has been in a strong uptrend in the past few months, moving to a high of 1.2085, its highest level in years. It has jumped from a low of 1.1600 in 2025 to a high of 1.2080.
The pair moved above the key resistance level at 1.1920, its highest level on September 17. It also rose above the important resistance level at 1.1805, the upper side of the ascending triangle pattern.
The pair remains above the 50-day and 100-day Exponential Moving Averages (EMA), while the Relative Strength Index (RSI) has continued rising.
Therefore, the pair will likely continue rising as bulls target the important resistance level at 1.2150. A drop below the important support level at 1.1800 will invalidate the bullish outlook.
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