EUR/USD: Uptrend Intact With Pair Now Testing Key Resistance

The EUR/USD pair closed at 1.0623, with an intraday high of 1.0664 and a low of 1.0595. After recovering from December’s lows, the pair has built a steady uptrend, though it now faces a key resistance area that could determine the next directional move.

Key Technical Observations

• Moving Averages Supportive:
  The 15-day moving average (1.0796) and 20-day moving average (1.0805) are acting as dynamic support, keeping the pair above its short-term base. The slope remains positive.
• Trend Structure:
  Since bottoming out in late December, the pair has been making higher highs and higher lows, confirming bullish structure. Current price is consolidating below the 1.1780–1.1800 resistance zone.
• RSI Constructive:
  The RSI sits at 56.72, just above neutral, signalling healthy momentum without being overbought. This allows for further upside if resistance breaks.
• Resistance Confluence:
  Price is testing resistance near 1.1780, where past highs capped advances. A decisive close above here would strengthen the bullish case.

Macro & Market Context

• ECB vs Fed Policy Divergence:
  The ECB’s hawkish tone relative to softer Fed expectations continues to lend support to the euro.
• USD Weakness (DXY Link):
  With DXY under pressure and holding near multi-month lows, the pair is benefitting from broader USD softness.
• Market Sentiment:
  Risk-on sentiment in equities is favouring higher-yielding currencies like the euro.

Key Levels to Watch

• Immediate Resistance: 1.1780 – 1.1800 (critical breakout zone).
• Next Resistance: 1.2000 – psychological round figure.
• Immediate Support: 1.1500 – prior swing low.
• Deeper Support: 1.1390 – base of the last consolidation.

Bias: Bullish-to-Neutral

Momentum remains constructive, with the uptrend intact. However, failure to break 1.1780–1.1800 may trigger profit-taking, pulling the pair back toward 1.1500 support. Sustained closes above 1.1800 would reopen upside toward 1.2000.

The pair remains in a buy-the-dip environment as long as it holds above the 1.1500–1.1600 support region. Watch for a breakout above 1.1780 for bullish continuation, but be cautious of potential rejection given its historical importance.