Euro Technical Forecast: EUR/USD Rebound Hits Pivotal Resistance at Former Support

Euro Technical Forecast: EUR/USD Weekly Trade Levels

EUR/USD has rebounded off downtrend support after a sharp selloff- up nearly 0.8% off the monthly low.
Euro is now testing resistance at a key technical barrier that has triggered major price inflections throughout the year.
A rejection here would reinforce the broader downtrend while a sustained break would ease immediate downside pressure and threaten a larger recovery.
Major event risk on next week with the Fed rate decision on tap
Resistance 1.1578/98, ~1.1671/77 (key), 1.1745/75- Support 1.1483 (key), 1.1355/94, 1.1110/63

EUR/USD is rebounding after finding support at the lower bounds of the April downtrend, but the recovery is now running into a pivotal resistance zone defined by former support. This area represents the first major hurdle for the rebound and could prove decisive for the near-term outlook. With the broader downtrend still intact and the FOMC decision on tap next week, the focus is on whether sellers reassert control at resistance or if buyers can force a larger recovery.. Battle lines drawn on the EUR/USD weekly technical chart.

Review my latest Weekly Strategy Webinar for an in-depth breakdown of this EUR/USD technical setup and more. Join live on Monday’s at 8:30am EST.

Euro Price Chart – EUR/USD Weekly

Chart Prepared by Michael Boutros, Sr. Technical Strategist; EUR/USD on TradingView

Technical Outlook: In last month’s Euro Technical Forecast we noted that EUR/USD had rebounded from pivotal support and into the close of May and that, “From a trading standpoint, rallies would need to be limited to the yearly open IF price is heading lower on this stretch with a close below 1.1578 still needed to mark resumption of the broader downtrend.” Euro turned lower the following week with a break below support extending more than 2.5% off the May high before rebounding off the median line this week.

The recovery takes Euro back into resistance at former support around 1.1578/98- a region defined by the 61.8% retracement of the March rally, the May low, and the January close low. The focus heading into next week is on a reaction off this zone. Subsequent resistance is eyed with the 52-week and 200-day moving averages near ~1.1671/76 with broader bearish invalidation steady at the yearly open and the 2025 high-week close / high close at 1.1746/75.

Initial weekly support now rests with the 1.618% extension of the April decline at 1.1483. Note that the median line converges on this threshold over the next few weeks and a break / close below this slope is needed to fuel the next major leg of the decline. The next major technical consideration rests at 1.1355/94- a region defined by the 38.2% retracement of the 2025 advance, the April high close, and the July swing low. Look for a larger reaction there IF reached.

Bottom line: A rebound off downtrend support is now approaching pivotal resistance and the focus is on possible inflection off this mark next week. From a trading standpoint, rallies would need to be limited to the 52-week moving average IF price is heading lower on this stretch with a close below 1.1483 needed to fuel the next leg of the decline.

Keep in mind the FOMC rate decision is on tap Wednesday with newly minted Fed Chairman Kevin Warsh making his inaugural address to the markets. Traders will be closely eyeing the central bank’s updated Summary of Economic Projections on growth, employment, and most notably, inflation. The focus will be on the Core PCE projections and the interest rate dot plot as traders assess the committee’s willingness to remain on hold amid stubbornly high inflation.

As of now, Fed Fund Futures are pricing a 58% probability the central bank will need to hike at least 25 basis points before the end of the year. This has been a tailwind for the greenback but if the projections or show an optimistic view on inflation or if a lasting resolution is reached with regards to the ongoing conflict in Iran, the U.S. Dollar may come under renewed pressure as rate expectations ease. Review my latest Euro Short-term Outlook for a closer look at the near-term EUR/USD technical trade levels.

Key Euro / US Economic Data Releases

Economic Calendar - latest economic developments and upcoming event risk.

Active Weekly Technical Charts

--- Written by Michael Boutros, Senior Technical Strategist

Follow Michael on X @MBForex

StoneX Financial Ltd (trading as "FOREX.com") is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, FOREX.com does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date.

This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it. No opinion given in this material constitutes a recommendation by FOREX.com or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.

The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although FOREX.com is not specifically prevented from dealing before providing this material, FOREX.com does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation. For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 74% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

FOREX.com is a trading name of StoneX Financial Ltd. StoneX Financial Ltd is a company incorporated in England and Wales with UK Companies House number 05616586 and with its registered office at 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is authorised and regulated by the Financial Conduct Authority in the UK, with FCA Register Number: 446717.

FOREX.com is a trademark of StoneX Financial Ltd . This website uses cookies to provide you with the very best experience and to know you better. By visiting our website with your browser set to allow cookies, you consent to our use of cookies as described in our Privacy Policy. FOREX.com products and services are not intended for Belgium residents.