EUR/USD Price Forecast: Bulls remain cautious below 23.6% Fibo. and 1.1470 hurdle
- EUR/USD trades with a positive bias for the second straight day amid a softer US Dollar.
- Escalating US-Iran tensions keep geopolitical risk premiums in play and support the USD.
- The technical setup also warrants some caution before placing bullish bets on the pair.
The EUR/USD pair attracts some dip-buyers following the previous day's pullback from the 1.1460-1.1470 horizontal resistance, though it remains confined within a multi-week-old range. Spot prices trade around the 1.1435-1.1440 region during the Asian session on Wednesday, up for the second straight day amid modest US Dollar (USD) weakness.
Softer-than-expected US consumer inflation data, released on Tuesday, forced traders to scale back their expectations of Federal Reserve (Fed) rate hikes, which keeps the USD bulls depressed and acts as a tailwind for the EUR/USD pair. However, inflation risks stemming from elevated crude oil prices and Fed Chair Kevin Warsh's price stability commitment, along with escalating US-Iran tensions, should limit deeper USD losses and cap the currency pair.
The EUR/USD pair has been struggling to find acceptance and build on its strength beyond the 23.6% Fibonacci retracement level of the April-June downfall. Adding to this, momentum indicators hint at scope for corrective upticks rather than a clear trend reversal. The Moving Average Convergence Divergence (MACD) indicator has turned positive, and the Relative Strength Index (RSI) around 56 suggests improving but still moderate bullish momentum.
This further warrants some caution before placing aggressive bullish bets on the EUR/USD pair and positioning for an extension of the recent recovery from the 1.1325 region, or the year-to-date low touched in June. The subsequent resistance below the 23.6% Fibo. aligns at the 200-period Simple Moving Average (SMA) on the 4-hour chart, near 1.1490, with the 38.2% retracement near 1.1523 and the 50.0% level around 1.1585 acting as the next relevant hurdles.
On the downside, the main structural support emerges at the Fibonacci anchor close to 1.1323, and a clear break under this floor would likely reinforce the broader bearish outlook for the EUR/USD pair.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
EUR/USD 4-hour chart
US Dollar Price Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Swiss Franc.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.16% | -0.05% | -0.08% | -0.10% | -0.17% | -0.03% | -0.00% | |
| EUR | 0.16% | 0.05% | 0.07% | 0.05% | -0.06% | 0.07% | 0.15% | |
| GBP | 0.05% | -0.05% | 0.02% | -0.01% | -0.11% | 0.02% | 0.09% | |
| JPY | 0.08% | -0.07% | -0.02% | -0.03% | -0.11% | 0.03% | 0.06% | |
| CAD | 0.10% | -0.05% | 0.01% | 0.03% | -0.07% | 0.00% | 0.10% | |
| AUD | 0.17% | 0.06% | 0.11% | 0.11% | 0.07% | 0.11% | 0.16% | |
| NZD | 0.03% | -0.07% | -0.02% | -0.03% | -0.01% | -0.11% | 0.07% | |
| CHF | 0.00% | -0.15% | -0.09% | -0.06% | -0.10% | -0.16% | -0.07% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
Author
Haresh Menghani
FXStreet
Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.
