EUR/USD: Decent support lines up in the 2021 lows around 1.2050

FXStreet Team FXStreet

The single currency starts the week on the defensive vs. the greenback following two consecutive sessions with gains as the EUR/USD pair extends the rangebound trading above 1.2100. Extra consolidation looks likely, according to FXStreet’s Pablo Piovano.

Key quotes

“The progress of the coronavirus pandemic along with the vaccine rollout and the upcoming debate on the stimulus package by US policymakers (due later in the week) are seen the main drivers of the pair’s price action at least in the short-term horizon.”

“The inability of bulls to push EUR/USD past recent tops in the vicinity of 1.2200 has sparked the ongoing consolidation with the lower bound of the range in the mid-1.2000s, or YTD lows. This idea is reinforced by the RSI navigating the proximity of the 50 level. A sustainable move beyond this area should pave the way for a test of the so far yearly peaks around 1.2350.”

“The 2021 lows near 1.2050 are expected to hold bouts of selling pressure. Further south of this level carries the potential to trigger a deeper pullback to, initially, the Fibo retracement (of the November-January rally) at 1.1976.”

Author

FXStreet Team

FXStreet

Composed of a group of economic journalists and FX experts, the FXStreet content team produces and oversees all content published on FXStreet. It provides a purely journalistic approach to the Forex market.

GBP/USD extends the drop to 1.3360

GBP/USD builds on Monday’s decline and briefly clinches five-day lows near 1.3360 on Tuesday. Cable’s extra pullback follows the better tone in the Greenback as uncertainty in the Middle East prompts investors to adopt a cautious stance. Meanwhile, an apathetic UK labour market report also collaborates with the selling pressure on the British Pound.

EUR/USD stays offered just above 1.1400

EUR/USD keeps the downtrend well in place for yet another day, challenging the 1.1400 contention zone on Tuesday. The continuation of the selling impulse in spot comes amid decent gains in the US Dollar, which continues to find support in the persistent effervescence surrounding the US-Iran crisis.

Middle East crisis intensifies, Gold up

Gold now seems to have embarked on a consolidative phase below the key $4,100 mark per troy ounce in the latter part of Tuesday’s session. Meanwhile, uncertainty surrounding the Middle East conflict and rising expectations for a hawkish Fed policy outlook are expected to limit the precious metal’s bullish momentum in the near term.

XRP rebounds on rising on-chain activity

Ripple (XRP) ticks up and trades around $1.13 at the time of writing on Tuesday. This rebound aligns with a broader recovery in the cryptocurrency market, attributed to reports that mediators between the United States (US) and Iran are seeking a 10-day cessation of strikes to find a way back to the signed Memorandum of Understanding (MoU).

The Iranian war has again risen

The Iranian war has again risen to the top of the economics factor list. There is no end in sight. Intelligence experts say the current level of offense/retaliation will not change minds in Tehran, while in Washington, Trump fears all-out war, which would mean boots on the ground.

US Dollar mid-year outlook: Exceptional currency, exceptional risks?

The US Dollar enters the second half of 2026 in a markedly different position from a year ago. The King currency has recovered, reflecting persistent US inflation, changing expectations for Fed policy, geopolitical tensions and renewed demand for defensive assets.