*Interest Rate Differentials:* The Federal Reserve has maintained a hawkish stance, while the European Central Bank (ECB) has adopted a more cautious approach, keeping rates lower for longer. This has supported the USD against the EUR.
- *Economic Data:* Recent US economic data, including strong employment figures and higher-than-expected inflation, have bolstered the USD. In contrast, Eurozone growth remains sluggish, with inflation below target.
- *Geopolitical Risks:* Ongoing geopolitical tensions in Europe, particularly energy supply concerns, continue to weigh on the EUR.
Bullish Breakout*
- *Entry Point:* Buy above 1.0950 (confirmed breakout with a 4-hour close).
- *Take Profit Levels:*
- TP1: 1.1000 (psychological level).
- TP2: 1.1250 (2024 high).
- *Stop Loss:* 1.0850 (below the breakout level).
- *Risk-Reward Ratio:* 1:2.
Scenario 2: Bearish Breakdown*
- *Entry Point:* Sell below 1.0700 (confirmed breakdown with a 4-hour close).
- *Take Profit Levels:*
- TP1: 1.0600 (weekly support).
- TP2: 1.0350 (2023 low).
- *Stop Loss:* 1.0800 (above the breakdown level).
- *Risk-Reward Ratio:* 1:2.5.
Daily Chart (Short-Term Perspective):*
- *Trend:* The daily chart shows a neutral to slightly bullish bias, with the pair trading above the 50-day MA but below the 200-day MA.
- *Key Levels:*
- *Support:* 1.0700 (recent swing low) and 1.0600 (weekly support).
- *Resistance:* 1.0900 (recent swing high) and 1.0950 (weekly resistance).
- *Breakout Point:* A break above 1.0950 could trigger bullish momentum, while a break below 1.0700 could lead to further downside.
Conclusion*
The EUR/USD pair is at a critical juncture, with key support and resistance levels defining the next major move. Traders should remain vigilant for breakout opportunities while managing risk effectively. The current setup favors a cautious approach, with a bias toward a bearish breakdown given the broader macroeconomic backdrop.
- *Economic Data:* Recent US economic data, including strong employment figures and higher-than-expected inflation, have bolstered the USD. In contrast, Eurozone growth remains sluggish, with inflation below target.
- *Geopolitical Risks:* Ongoing geopolitical tensions in Europe, particularly energy supply concerns, continue to weigh on the EUR.
Bullish Breakout*
- *Entry Point:* Buy above 1.0950 (confirmed breakout with a 4-hour close).
- *Take Profit Levels:*
- TP1: 1.1000 (psychological level).
- TP2: 1.1250 (2024 high).
- *Stop Loss:* 1.0850 (below the breakout level).
- *Risk-Reward Ratio:* 1:2.
Scenario 2: Bearish Breakdown*
- *Entry Point:* Sell below 1.0700 (confirmed breakdown with a 4-hour close).
- *Take Profit Levels:*
- TP1: 1.0600 (weekly support).
- TP2: 1.0350 (2023 low).
- *Stop Loss:* 1.0800 (above the breakdown level).
- *Risk-Reward Ratio:* 1:2.5.
Daily Chart (Short-Term Perspective):*
- *Trend:* The daily chart shows a neutral to slightly bullish bias, with the pair trading above the 50-day MA but below the 200-day MA.
- *Key Levels:*
- *Support:* 1.0700 (recent swing low) and 1.0600 (weekly support).
- *Resistance:* 1.0900 (recent swing high) and 1.0950 (weekly resistance).
- *Breakout Point:* A break above 1.0950 could trigger bullish momentum, while a break below 1.0700 could lead to further downside.
Conclusion*
The EUR/USD pair is at a critical juncture, with key support and resistance levels defining the next major move. Traders should remain vigilant for breakout opportunities while managing risk effectively. The current setup favors a cautious approach, with a bias toward a bearish breakdown given the broader macroeconomic backdrop.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.