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Currencies EUR/USD

EUR/USD Price Analysis: Bearish Reversal Imminent as Upward Wedge Pattern Indicates Weakening Momentum

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  • February 21, 2025
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The EUR/USD currency pair is low-key around the 1.0500 region, ranging in a rising wedge pattern, which points towards an impending bearish reversal. Although the 14-day RSI is close to 60, reflecting sustained bullish momentum, a reading above 70 may set off an overbought correction. The pair is currently positioned above both the nine-day and 14-day EMAs, which supports short-term strength. But a fall below the key support levels of 1.0453 (nine-day EMA) and 1.0436 (14-day EMA) would seal a bearish move, which could take the pair to 1.0177, its lowest since November 2022. On the higher side, resistance is at 1.0540, with a breakaway likely to take the pair to the two-month high of 1.0630. KEY LOOKOUTS • EUR/USD trades in a rising wedge formation, which could portend a possible bearish reversal if the downward pressure gathers strength and important support levels are breached. • The 14-day RSI fluctuates close to 60; an increase above 70 can be an indication of overbought, and it can lead to a pullback correction in the pair. • The nine-day EMA of the pair at 1.0453 and 14-day EMA at 1.0436 are the crucial support levels—a break below could seal further downside threats. • The higher limit of the rising wedge at 1.0540 is still a significant resistance level—a break above might push the pair towards 1.0630 highs. The EUR/USD pair continues to be at a pivotal point, ranging about 1.0500 in a rising wedge pattern, which could indicate a bearish reversal if bearish momentum picks up. The 14-day RSI close to 60 indicates ongoing bullish support, but a move above 70 would signal overbought levels, raising the probability of a corrective pullback. The key support levels are at 1.0453 (nine-day EMA) and 1.0436 (14-day EMA), and a clean break below this level may further speed losses to 1.0177, its lowest since November 2022. On the other hand, a breakout above 1.0540, the top of the rising wedge, may solidify the bullish bias, moving the pair to the 1.0630 resistance level, which was last visited in early December. EUR/USD is quoted at 1.0500, trending within a rising wedge formation, suggesting a bearish reversal if a break of significant support at 1.0453 occurs. A reading near 60 in the 14-day RSI indicates bullish strength, but above 70 it might trigger a pullback. Breaking above 1.0540 can advance the pair towards 1.0630, solidifying a bullish trend. • EUR/USD is in a rising wedge, suggesting a bearish reversal if downside pressure picks up. • The nine-day EMA at 1.0453 and 14-day EMA at 1.0436 serve as crucial support; a break below could accelerate losses. • The upper boundary of the wedge at 1.0540 acts as a key resistance—breaking above it could trigger further bullish momentum. • The 14-day RSI suggests continued bullish strength, but a move above 70 may indicate overbought conditions, leading to a correction. • A decline below 1.0436 could turn momentum on the downside and drive the pair to 1.0177, its low since November 2022. • Should EUR/USD cross above 1.0540, it will test the two-month high at 1.0630, supporting a bull scenario. • The pair trades above its EMAs, supporting short-term bullishness, though falling volume within the wedge is an indicator of weakening buying force. The EUR/USD is in the limelight as market players closely monitor its trajectory in the wake of global economic developments. Investor moods are determined by several factors, such as geopolitical events, central bank actions, and macroeconomic announcements. The performance of the European economy, particularly regarding inflation and growth indicators, has a strong bearing on the outlook for the euro. At the same time, the U.S. dollar continues to be a dominant force, fueled by economic data, interest rate expectations, and general market sentiment. The interaction of these underlying factors decides the strength and stability of the currency pair. EUR/USD Daily Price Chart TradingView Prepared by ELLYANA Market sentiment is also influenced by investor sentiment, risk appetite, and external factors such as trade relations and monetary policy announcements. Any changes in world financial conditions have a profound effect on exchange rate behavior. Traders and investors track these variables to estimate possible movements and make sound judgments. Consumer spending, employment patterns, and economic stability in both regions also play a role in long-term trends in the EUR/USD currency pair. Knowledge of these factors aids in evaluating market conditions outside short-term volatility, giving a better view of currency market movement. TECHNICAL ANALYSIS The EUR/USD currency pair is now trading in the form of a rising wedge pattern, a pattern that usually indicates a probable trend reversal. The pair still holds above its nine-day and 14-day Exponential Moving Averages (EMAs), representing short-term bullishness. But a breakdown below the key support levels can lead to a bearish turn. The 14-day Relative Strength Index (RSI) is at about 60, indicating ongoing bullish support, but should it rise above 70, this would indicate overbought levels, and a correction would ensue. On the upside, 1.0540 is a crucial resistance level, and a break out above it would drive the pair to the 1.0630 level, strengthening the bullish trend. Alternatively, a firm fall beneath the 1.0453–1.0436 support region would result in additional downward pressure, validating a change in momentum. FORECAST The EUR/USD currency pair is at a decisive moment with both the bullish and bearish picture on the cards. If the bullish trend prevails, the pair may break above the 1.0540 resistance level, indicating further robustness. A successful break may take it towards the 1.0630 level, a two-month high set in early December. If buying continues to increase, the next target on the upside would be around 1.0700, fueled by optimistic market sentiment and healthy economic data out of the Eurozone. On the flip side, if EUR/USD does not hold onto its present levels and breaches vital support levels at 1.0453 (nine-day EMA) and 1.0436 (14-day EMA), then it would mark a bearish reversal. A decisive fall below this area can propel losses further to

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Currencies EUR/USD

EUR/USD surges past 1.0300 due to dollar weakness: What to expect?

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  • January 20, 2025
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EUR/USD retook the 1.0300 level after the US Dollar fell as the market cheered over the weak US economic data on retail sales and jobless claims. This comes ahead of the inauguration of President-elect Donald Trump, which is increasing market uncertainty amid rumors of possible trade tariff policies. Continuation of diverging monetary policies from the Fed, signaling caution in the rate cuts, and the ECB  is set to continue to weigh on the pair. Short-term recovery is possible, but long-term drivers will be a prominent challenge, such as US Dollar strength, geopolitical risks, and weak economic performances in the eurozone, especially Germany. KEY LOOKOUTS • Watch for further weakness in the US Dollar, driven by economic data, Fed policy signals, and Trump’s trade proposals. • The Fed’s cautious rate strategy and ECB’s growth focus create contrasting pressures, influencing EUR/USD’s ability to sustain gains. • Key eurozone figures like inflation and current account data on January 17 could significantly impact EUR/USD’s short-term movement. • Additional risks come from Trump’s trade tariffs and global uncertainties, which could reshape the monetary and economic landscape for EUR/USD. EUR/USD is subject to US Dollar trends, such as economic data, Fed policy changes, and Trump’s trade plans. Diverging monetary policies between the Fed, being cautious, and the ECB, which is focused on growth, will continue to drive the outlook for the pair. Short-term direction may come from eurozone data, such as inflation and current account numbers. Geopolitical uncertainty, such as trade tariffs, may also continue to drive volatility and reshape the economic landscape, which will challenge the sustained recovery of EUR/USD. EUR/USD faces pressures from diverging Fed-ECB policies, with key focus on US Dollar trends, eurozone data, and geopolitical risks, including Trump’s proposed trade tariffs and economic uncertainties. • Disappointing US retail sales, jobless claims, and dovish Fed signals have weighed on the Greenback, allowing EUR/USD to reclaim 1.0300. • The Fed’s cautious approach to rate cuts contrasts with the ECB’s focus on supporting growth, adding pressure on EUR/USD’s recovery. • The threat of President-elect Trump’s reinstatement of trade tariffs will likely increase US inflation and alter monetary policy, which in turn will influence EUR/USD. • Global trade tensions, fiscal policy changes, and eurozone uncertainties, especially in Germany, are major drivers for EUR/USD. • Support is at 1.0176 and parity at 1.0000, while resistance is seen at 1.0436, 1.0506, and the 200-day SMA at 1.0779. • Inflation and current account figures on January 17 will be crucial to determine the state of eurozone’s economy and movement in EUR/USD. • Momentum indicators like RSI and ADX have indicated bearish trends, suggesting that EUR/USD may fail to hold onto gains in this market environment. EUR/USD has managed to recover the 1.0300 level, buoyed by a weaker US Dollar, which was driven by weak economic data, including retail sales and jobless claims, as well as dovish signals from the Federal Reserve. Market sentiment remains cautious ahead of President-elect Donald Trump’s inauguration, with traders concerned about his proposed trade tariffs, which could drive up US inflation and impact monetary policy. Central banks are diverging approaches to make things worse for the pair, with the Fed indicating hesitance on more rate cuts and the European Central Bank maintaining its growth thrust even in the face of rising inflation. These two levels have their support at 1.0176 and resistance at 1.0436-EUR/USD Daily Price Chart. Sources: TradingView, Prepared By ELLYANA Further data releases from the eurozone could include inflation, which will come out on January 17, and current account figures, all helping to provide further clarification regarding the state of the region’s economy as well as touching upon EUR/USD. The overall trend is bearish in the short run with the pair below the 200-day SMA at 1.0779, while further politicized global trade risks and economic woes within Germany further darken the horizon. Indicators like the RSI and ADX, indicating weak short-term prospects of recovery, present challenges in this scenario with regard to how the EUR/USD is expected to move given conflicting monetary policies and economic conditions of uncertainty that surround the market currently. TECHNICAL ANALYSIS In technical analysis, EUR/USD is seen as remaining in a longer-term downtrend while staying below the 200-day SMA at 1.0779. The nearer supports listed are 1.0176, parity at 1.0000, then further down at 0.9935 and 0.9730. These might serve as potential upside targets should the bearish momentum continue. Downside resistance is seen at 1.0436 and 1.0506, the 55-day Simple Moving Average, and at 1.0629, the December peak. Further short-term resistance levels to watch for any recovery attempts occur at 1.0354 and 1.0434. Momentum indicators are the RSI near 41, which states range-bound conditions, and ADX at 35, marking a strengthening of the bearish trend, meaning this pair may lack the strength required to break upward without a robust catalyst. FORECAST EUR/USD stands a chance for upward movement as it breaks over key resistance zones at 1.0436 and 1.0506 or the 55-day SMA. A continued rally might aim for the peak in December at 1.0629 and, with strong enough bullish momentum, even the 200-day SMA at 1.0779. Improving conditions for an uptrend include further US Dollar weakness on disappointing economic data, or dovish comments from the Federal Reserve, or market expectations for less aggressive rate hikes. Additionally, stronger-than-expected eurozone data, such as inflation or current account figures, could boost the Euro, providing short-term recovery opportunities. On the downside, EUR/USD remains under pressure from its broader bearish trend, with support levels at 1.0176, parity at 1.0000, and further down at 0.9935 and 0.9730. An inability to sustain these levels may precipitate further losses, especially with a strengthening US Dollar created by strong economic performance, hawkish Fed surprises, or increased geopolitical risks. The failure of eurozone economies, especially Germany, along with the possibility of global trade tensions and fiscal policy uncertainties, could also weigh significantly on the Euro, where deeper lows for EUR/USD might occur. This might even strengthen bearish sentiment in the short to medium term, as the pair

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Currencies EUR/USD

EUR/USD Falls to Less Than 1.0300 on Prospect of ECB Rate Cut

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  • January 17, 2025
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The EUR/USD trades at the edge of 1.0290, weakened by prospects for gentle rate cuts by the ECB and the strength of the US Dollar that is further helped by mixed US economic reports and dovish messages from the Fed. However, interim resistance for the EUR/USD remains at 1.0354 and 1.0434 while key supports lie at 1.0176 and at parity at 1.0000, representing an ongoing downtrend below the 200-day SMA at 1.0779. The ECB continues to focus on growth in a rising inflationary environment, and the Fed will remain cautious with respect to adjustments in rates amid growing inflationary concerns and fiscal uncertainty. Fresh direction will be given by upcoming eurozone inflation and current account data, as EUR/USD remains in a difficult economic and geopolitical scenario. KEY LOOKOUTS • The Euro continues to see pressure due to the European Central Bank’s slow rate cuts; inflation dynamics persist, and even economic growth in the region comes under question. • The mixed US economic figures, Fed policies, and rumors of trade tariff implications under an administration led by President-elect Donald Trump continue favoring the Dollar. • Pivotal Support is at 1.0176, the resistance at 1.0354 and at 1.0434 and the bearish trend continues unabated below 200-day SMA at 1.0779. • Eurozone inflation and current account figures for January 17 will be an important factor that will decide EUR/USD prices in the short-term. EUR/USD continues its downward pressure, trading near the 1.0290 handle, weighed on by the market’s expectation for gradual ECB cuts, as the euro faces two contrasting monetary policies and a strength US Dollar. Technical levels indicate strong support at 1.0176 and parity at 1.0000, while resistance is seen at 1.0354 and 1.0434, and the overall bearish trend continues to hold below the 200-day SMA at 1.0779. Eurozone inflation and current account data on January 17 will be important in giving the pair a fresh push. Geopolitical and economic uncertainties related to US trade tariffs and cautious stances by both the Fed and ECB add weight to the downtrend of this pair. EUR/USD fails to break above 1.0300 as it is pressured further by the ECB’s cautious approach to rate cut and strong dynamics of the US Dollar. EUR/USD pairs await eurozone inflation data to take fresh market cues. EUR/USD falls back to 1.0290, pressured further by monetary policy expectations and the stronger US Dollar. • Expected gradual cuts from the European Central Bank pressure the euro. • The Fed is conservative about easing and remains cautious with inflation, making the US Dollar more likely. • Levels to watch: Support 1.0176 and parity 1.0000 • Resistance at 1.0354, 1.0434, and the 200-day SMA at 1.0779 • Eurozone inflation and current account figures for January 17 are major market sentiment gauges. • Uncertainties regarding US trade tariffs also put a strain on the euro. EUR/USD has stayed under pressure lately, trading at 1.0290 while contrasting monetary policies between the ECB and Fed have been bearing down on the euro. Gradual rate cuts anticipated by the ECB to stimulate growth in the economy have lowered the mood of investors, particularly given that inflation in the eurozone is moving closer to higher rates. Meanwhile, the US Dollar keeps on reaping the benefits of cautious Fed signals and mixed US economic data that include poor retail sales and dovish comments from FOMC officials that are fueling rate adjustment speculation as modest. EUR/USD Daily Price Chart Sources: TradeView, Prepared By ELLYANA EUR/USD is currently holding at the support levels at 1.0176 and at parity 1.0000, whereas the resistance levels stand at 1.0354 and 1.0434, with the bigger bearish trend holding below the 200-day SMA at 1.0779. Traders are closely watching eurozone inflation and current account figures due on January 17, which could provide fresh direction. Adding to the uncertainty are geopolitical risks, such as the potential reintroduction of US trade tariffs under President-elect Donald Trump, which may further strengthen the Greenback and keep the euro under pressure in the near term. TECHNICAL ANALYSIS Currency majors – EUR/USD : Remains in a bearish trend while trading below the 200-day SMA at 1.0779. Downside levels of note include the YTD low at 1.0176, parity at 1.0000, with potentially further downsides to 0.9935 and 0.9730. Upwardly, immediate resistances stand at 1.0354 and 1.0434, with stronger resistances at 1.0506 (55-day SMA) and 1.0629 (peak into December). Momentum indicators mixed and giving a bearish bias since RSI near 41 can indicate range-bound activity, but ADX near 35 does support the uptick in bearish momentum, which will likely keep downside risks elevated for the pair. FORECAST EUR/USD maintains its supremacy for the short and medium term while the pair hovers below main resistance levels with the overall downward trend remaining unbroken below 200-day SMA at 1.0779. The near-term support could be seen in the form of 1.0176 as the YTD low, 1.0000 (parity level), and beyond at 0.9935 and 0.9730 if the sell pressure intensifies. Short-term relief will come in if the pair manages to move above the near-term resistance level of 1.0354 and 1.0434. It will need a higher break above 1.0506, the 55-day SMA, and 1.0629, the December high, but this will also see substantial selling on those levels. Overall, it will depend largely on ECB and Fed policy announcements as well as upcoming eurozone inflation and US economic data for the pair’s direction.

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