FX.co ★ KHALISA | EUR/USD

EUR/USD on the Edge: Key Levels in Focus as Momentum Builds Market Influencing Factors The US dollar has found support from rising Treasury yields and renewed expectations that the Federal Reserve could raise rates as early as September. Fed Chair Kevin Warsh's recent hawkish message has changed the tone of the market, while the probability of a September hike has climbed toward 65%. That has made dollar rallies easier to sustain, particularly with the US 10-year Treasury yield reaching around 4.78%. The euro, however, has its own argument. Eurozone inflation is expected to remain elevated, keeping pressure on the European Central Bank to consider tighter policy. Rising energy prices are making the situation more complicated. Brent crude has moved above $91, while renewed Middle East tensions are keeping inflation concerns alive across Europe. For EUR/USD, this creates a tug-of-war. Stronger European inflation can support the euro through higher ECB rate expectations, while stronger US yields can pull money back toward the dollar. Traders will therefore pay close attention to Eurozone CPI today and the US jobs data later this week. Technical Analysis EUR/USD structure remains constructive after the pair's earlier recovery, but the short-term trend has clearly lost some momentum. Price is now sitting near the 1.1600 region, which has become a key line in the sand. Current technical readings place the 100-day moving average around 1.1635 and the 200-day moving average near 1.1655-1.1660. These averages create a sizeable resistance band above the current price. The near-term Fibonacci and pivot structure points toward 1.1615-1.1625 as the first upside hurdle. A clean break could expose 1.1630 and then the 1.1655-1.1660 zone. Recent candles show a market struggling to build sustained upside momentum. Buyers continue to respond around 1.1600, but rallies are being sold near 1.1620. This suggests a battle rather than a confirmed trend reversal. A strong bullish daily close above 1.1630 would improve the picture considerably. On the other hand, a bearish close below 1.1595 would indicate that sellers are finally breaking the support structure. The first resistance sits around 1.1620-1.1625, followed by 1.1630-1.1635. The bigger barrier comes near 1.1655-1.1660, where the 200-day moving average is located. Above that, 1.1680 becomes the next area bulls would likely target. The first support remains 1.1600, followed by 1.1580-1.1590. A deeper move could take EUR/USD toward 1.1565-1.1570, an area that has attracted attention as broader trend support. Current market analysis also identifies the 100-day moving average near 1.1568 as an important downside reference. The MACD is close to the zero line, showing that momentum is not strongly committed in either direction. Current technical readings still give the indicator a mild bullish tilt, but the signal is hardly convincing. A move above 1.1630 accompanied by a strengthening MACD would favor buyers. If the MACD rolls lower while price breaks 1.1600, the bearish side could quickly take control. The RSI picture is also mixed. Recent readings have been around the 48-51 zone, leaving the indicator close to neutral. That means EUR/USD is neither oversold nor overbought. There is plenty of room for a directional move once the market receives a strong fundamental trigger. Liquidity is building around 1.1600, making this level particularly interesting. Option expiries at 1.1600 are also expected to act as a price magnet during today's session, potentially keeping the pair trapped near the figure before a larger move develops. Above the market, liquidity is likely concentrated around 1.1625-1.1635. Below, stops may gather underneath 1.1590 and 1.1570. Trade Setups and Market Scenario Bullish setup A defense of 1.1600 followed by a break above 1.1625 could open the way toward 1.1655 and potentially 1.1680. The setup becomes stronger if price holds above 1.1635. Range setup If EUR/USD remains between 1.1600 and 1.1630, short-term traders may continue to see false breaks and quick reversals. The market could stay compressed until inflation and US labor data provide a clearer direction. Bearish setup A sustained break below 1.1590 would put 1.1570 into focus, followed by the 1.1550 area. A break beneath those levels would weaken the broader recovery and give dollar bulls considerably more room to push lower.

Good afternoon, Riruru, I'm pleased to be joining your journal discussion again today, discussing the EURUSD pair. May I share my perspective, using the Moving Average, Bollinger Band, and MACD trend strategies I use? I hope this proves useful and can serve as a reference for developing better trading plans.

Moving to the daily timeframe, the trend is still considered bullish, and this structure is clearly visible on the chart. The EURUSD price at 1.16085 is above the mid-Bollinger Band and also above the red 50-EMA at 1.15200, indicating that buyers remain in control of the major trend. The weakening in the last few candles is normal, as the price previously hit the upper Bollinger Band at 1.17185, indicating overbought conditions. This correction is a healthy one. As long as the price can stay above the mid-BB or demand area of 1.15874, marked by the gray box, the bullish potential remains strong. As seen yesterday, when the price entered the demand area at 1.15874, a strong buyer reaction immediately emerged, leading to a rebound to 1.16300. This first-time-back-to-demand concept can be utilized to seek profits with a fairly high probability. The MACD indicator, with settings of 12, 24, and 4, maintains bullish sentiment, but momentum is starting to show signs of weakening. This can be seen in the histogram, which remains above zero at 0.0033904. However, the MACD line at 0.0033300 is beginning to slope downward, and the previously high histogram is now beginning to decline slightly. This indicates that buying momentum is slowing, although the underlying trend remains unchanged. As long as the MACD remains above zero, the bullish bias remains dominant over the bearish, and any decline is considered a correction. Closely monitor the demand area at 1.15874, as it is a key area for determining the next direction. If the price is able to hold and provides bullish confirmation, such as a bullish engulfing or pin bar, there is still a strong opportunity to continue rising towards 1.17500. However, if the demand level at 1.15874 is broken and the daily close is below the gray zone, the next support target will be 1.15200, which serves as the 50-day moving average (EMA) and psychological support. Because the current sentiment still holds the potential for a downward correction, there is indeed a chance that the price will weaken again today. Therefore, for my trading plan, I prefer to wait and see, waiting for a valid breakout, not forcing an entry mid-stream. I will only enter buy on demand or sell on breakdowns with clear confirmation.