EUR/USD Analysis Summary Today
- Overall Trend: Preparing for an upward breakout.
- Today’s EUR/USD Support Levels: 1.1630 – 1.1550 – 1.1480.
- Today’s EUR/USD Resistance Levels: 1.1720 – 1.1800 – 1.1870.
EUR/USD Trading Signals:
- Buy EUR/USD from the support level of 1.1570 with a target of 1.1900 and a stop loss of 1.1500.
- Sell EUR/USD from the resistance level of 1.1760 with a target of 1.1500 and a stop loss of 1.1810.
EUR/USD Technical Analysis Today:
Since the beginning of this week’s trading, the EUR/USD price has been attempting to rebound upwards, with gains that extended to the 1.1680 resistance level and is now stable near it at the time of writing. The pair is recovering from last week’s losses, which saw bears successfully push for a break below the 1.1400 support. This recent rebound is important for the Euro/dollar’s path to return to an upward trend. We will see if there are opportunities to break the 1.1830 resistance again, which, in turn, would renew expectations for the Euro/dollar to reach the psychological peak of 1.2000. This is a crucial area to confirm bull dominance and could push technical indicators towards strong overbought levels.
According to the daily timeframe chart, the 14-day RSI (Relative Strength Index) is stable around a reading of 55, moving away from the 50 neutral line and awaiting further gains before reaching overbought territory. At the same time, the MACD (Moving Average Convergence Divergence) lines are preparing to turn upwards. The current rebound of the EUR/USD will coincide with the announcement of German industrial production and the trade balance at 9:00 AM Egypt time. This will be followed by the inflation report from the European Central Bank at 11:00 AM Egypt time. On the American side, weekly jobless claims will be announced at 3:30 PM Egypt time, and at the same time, non-farm productivity and the Employment Cost Index will be released.
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Trading Tips:
Traders are advised to currently follow a strategy of selling the Euro/dollar on every strong upward rebound and to not take risks, no matter how strong the available trading opportunities seem.
Reasons for the Recent Rise in the Euro/Dollar:
According to monitoring and analysis by forex trading experts, the EUR/USD exchange rate has rebounded upwards as markets awaited new indicators on the economy and Federal Reserve policy, leading to relatively narrow trading ranges. According to experts, despite the sharp rise in the Euro last Friday, it is too early to expect a continued rally. We expected the Euro to trade within a range of 1.1435 to 1.1660. Experts also believe there is room to buy the Euro/dollar on dips; we expect buyers to return to the 1.1500/1520 range.
Regarding economic data, the US ISM services index fell to 50.1 in July from 50.8 previously, and was lower than the forecast of 51.5. US employment saw a sharp decrease, while prices rose at the fastest pace since December 2022. This data will raise new fears about stagflation, with weak economic activity and increasing upward pressure on prices. Both imports and exports saw significant declines, which will increase concerns about the economic impact of tariffs.
Overall, financial markets will continue to focus on comments from Federal Reserve officials. According to San Francisco Fed President Daly, two rate cuts still seem realistic for this year, but she hinted at the possibility of three. She added, “I was ready to wait for another cycle, but I cannot wait forever.”
In general, markets are still very confident that the Federal Reserve will cut US interest rates in September. The issue of Federal Reserve board appointments will also be a key market issue, with expectations that President Trump will nominate a replacement for Governor Kugler. Furthermore, there are expectations that this nominee could be the next Fed Chair. According to Trump, there is a shortlist of four candidates, including Kevin Warsh and National Economic Council Director Kevin Hassett. Also, he stated that Treasury Secretary Mnuchin ruled himself out of the position.
On the European side, the Eurozone has seen limited developments, with a slight downward revision to the services PMI, although it remained in expansionary territory. Commenting on the economic data, Scotiabank remains optimistic about the outlook; it stated, “Eurozone data surprises continue to come in generally positively, which should help to keep the Euro outlook strong as investors begin to anticipate that the Fed will catch up with the ECB’s aggressive policy easing.”
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