EUR/USD Analysis Summary Today
Overall Trend: Bearish.
Support Levels for EUR/USD Today: 1.1465 – 1.1380 – 1.1300
Resistance Levels for EUR/USD Today: 1.1570 – 1.1660 – 1.1710
EUR/USD Trading Signals:
Buy scenario: From the support level of 1.1440 with a target of 1.1730 and a stop-loss at 1.1400
Sell scenario: From the resistance level of 1.16100 with a target of 1.1420 and a stop-loss at 1.1680
Technical Analysis of EUR/USD Today
The EUR/USD exchange rate faced strong selling pressure following the announcement of the US Federal Reserve's policy decisions. Losses extended to the support level of 1.1477, the lowest for the currency pair since the end of last March, before stabilizing around the 1.1500 level at the start of Thursday's trading session. This paves the way for a bearish weekly close.
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Why Did EUR/USD Selling Pressure Increase?
According to data from top trading platforms, the EUR/USD price declined following the Federal Reserve's latest monetary policy decision.
While the US central bank kept interest rates unchanged—as was widely expected—the policymakers' outlook was deemed hawkish. Projections from Fed members indicated that tight monetary policy would persist for longer than expected, boosting demand for the US Dollar and putting pressure on the Euro.
Prior to the US decision, the European Central Bank (ECB) raised interest rates by 25 basis points last week, in line with expectations, as part of its ongoing efforts to combat high inflation.
However, following the US-Iran agreement, markets lowered their expectations for further monetary tightening by the ECB, now pricing in less than 30 basis points of additional rate hikes this year.
Trading Scenarios for the EUR/USD Pair
Based on the EUR/USD performance on the daily timeframe, the bearish scenario remains the strongest, and breaking below the 1.1500 psychological support barrier increases sellers' dominance. Following yesterday's losses, technical indicators are approaching oversold territory. The 14-day Relative Strength Index (RSI) is around a reading of 37, and the MACD indicator shows a clear downward trend. With the 100-day Simple Moving Average (SMA) below the 200-day SMA, sellers may target deeper bearish levels if positive factors for the US Dollar persist.
EUR/USD Future Trend Outlook
Technically, a daily close below the 1.1465 level will support a continued decline toward 1.1380 and then 1.1300. Conversely, buyers need to climb back above 1.1570 to regain bullish momentum.
Trading Advice:
It is preferable for traders to utilize any strong gains as selling opportunities. Also, ensure strict risk management is in place to navigate the current market uncertainty.
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