The bullish retracement has created a bearish head and shoulders chart pattern in line with the dominant trend, which will complete below $1.1600.
The Euro to Dollar (EUR/USD) exchange rate dipped sharply to 3-month lows just above 1.1500 on Monday as oil prices spiked to the highest level since 2022. There was a strong rally to just above 1.1650 on Tuesday as energy prices retreated sharply following comments from President Trump that the Iran war was close to complete.
EUR/USD: Hawkish ECB talk meets Oil risk – ING
The Euro hit a rebound as prices still facing resistance at 1.1655. As we see from the chart and if prices hold below the said resistance, the pressure will still affect the market for a further drop towards 1.1400.
EUR/USD: Pair steady as markets eye US CPI – Danske Bank
EUR/USD Price Forecast: Eyes 1.1650 barrier near nine-day EMA
EUR/USD edges higher above 1.1600 as US Dollar safe-haven demand fades
EUR/USD rises slightly as markets stay cautious amid US-Iran war
The euro was coming off its earlier highs at the time of writing, after it staged a decent recovery against the dollar as markets digest the sharp reversal in energy prices and a rebound in broader risk sentiment. While the move has helped stabilise the pair after recent volatility, the near-term EUR/USD outlook remains closely tied to developments in the Middle East and the direction of oil markets.
The Euro to Dollar (EUR/USD) exchange rate spiked higher on Friday following weaker than expected US jobs data, but there was a quick reversal with the pair sliding to 3-month lows just above the 1.1500 level before trading around 1.1560 as Middle East developments have dominated. ANZ notes important EUR/USD support at 1.15, but expects.
EUR/USD is trading around 1.1608 on Tuesday. The US dollar attempted to recover from a sharp intraday decline the previous day, which had been driven by expectations of a faster resolution to the conflict involving Iran, temporarily reducing demand for the dollar as a safe-haven asset.
Yesterday's price action confirmed these assumptions – the low at H is below the low of 3 February (F), refining the lower boundary of the channel. At the same time, the sharp upward reversal (shown by the arrow) indicates increasing demand, driven by a shift in sentiment due to several factors, including: