Bearish view
Top Regulated Brokers
Sell the EUR/USD pair and set a take-profit at 1.1300.
Add a stop-loss at 1.1450.
Timeline: 1-2 days.
Bullish view
Buy the EUR/USD pair and set a take-profit at 1.1450.
Add a stop-loss at 1.1300.
The EUR/USD pair wavered as the US and Iran paused their attacks, with traders also awaiting the upcoming Federal Reserve decision and key macro data from the US and the European Union. The pair traded at 1.1373, a level it has held around for the past few days.
Fed Decision and Key Macro Data
The EUR/USD pair wavered after the US and Iran paused their recent attacks, which dragged crude oil prices lower. Brent and the West Texas Intermediate (WTI) dropped to $86 and $81, respectively.
Oil prices reacted to a statement from President Donald Trump, who insisted that the two sides were talking. Iran has rejected these claims. In reality, the media has reported that US officials are concerned about the falling US weapons. Also, the head of CENTCOM said that there were no targets left to shoot along the Iranian coast.
The EUR/USD pair will next react to the upcoming US house price index and consumer confidence report. Economists expect the data to show that consumer confidence stabilized in July even as gasoline prices started rising.
After these numbers, focus will be on the upcoming Federal Reserve interest rate decision. This will be an important meeting as it will be the second one headed by Kevin Warsh.
Economists expect the bank to leave rates unchanged between 3.50% and 3.75% as it has done throughout the year. Nonetheless, some analysts predict the bank may deliver a surprise hike. A Polymarket poll estimates that odds of a rate hike have jumped to almost 30%.
The EUR/USD pair will also react to the upcoming US GDP and Personal Consumption Expenditure (PCE) report that will come out on Thursday. Europe will also release the flash inflation numbers for July on Friday this week.
EUR/USD Technical Analysis
The daily chart shows that the EUR/USD pair has remained in a narrow range in the past few days. It was trading at 1.1376, which is below the lower side of the ascending channel that forms part of the bearish flag pattern.
The pair has remained below the 50-day Exponential Moving Average (EMA) and the crucial support of 1.1410, its lowest level on March 16. Also, the Relative Strength Index 9RSI) has continued falling.
Therefore, the pair will likely continue falling, with the immediate target being at 1.1326, its lowest level in June. A move below that level will point to more downside in the near term.