rose to 1.1817 on Thursday, marking its ninth consecutive period of uninterrupted gains. The major currency pair continues to hit six-week highs. Pressure on the US dollar has intensified amid rising expectations of a diplomatic breakthrough between the United States and Iran, reducing demand for safe haven assets.
President Donald Trump said the seven-week conflict is coming to an end. The White House has also expressed confidence that an agreement can be reached. New face-to-face negotiations may resume in Pakistan.
Tehran is considering allowing free passage of ships through the Omani part of the Strait of Hormuz if a deal is reached, which could reduce the risks of further escalation.
Additional pressure on the dollar comes from lower energy prices, which have eased inflation fears and reduced expectations of further monetary tightening.
The market generally expects the Federal Reserve to keep interest rates unchanged this month and likely for the rest of the year.
Technical analysis
On the EUR/USD H4 chart, the market is forming a consolidation range around 1.1771. An upward wave is expected to continue to 1.1877 as a local target, followed by a possible downward wave to 1.1700. Technically, this scenario is confirmed by the MACD indicator, with its signal line above zero and pointing firmly upward, reflecting continued bullish momentum and supporting the possibility of the uptrend persisting.
According to the H1 chart, the market is forming the structure of the next ascending wave to the level of 1.1835. After reaching this level, a correction to 1.1795 is likely, followed by a possible rise to 1.1855, with a trend outlook towards 1.1877. Technically, this scenario is confirmed by the stochastic oscillator, with its signal line below 80 and pointing firmly towards 20.
Conclusion
EUR/USD has seen an impressive nine-session rally, driven by rising hopes for a diplomatic breakthrough between the United States and Iran, which has dampened safe-haven demand for the dollar. With President Trump suggesting the seven-week conflict is near an end and Tehran considering concessions over passage through the Strait of Hormuz, energy prices have fallen, easing inflation fears and reducing expectations of monetary tightening. The Federal Reserve is widely expected to keep rates steady. While technical indicators suggest continued bullish momentum towards 1.1877, the pair may need to undergo a short-term correction. The future trajectory depends on whether diplomatic efforts achieve a tangible deal or disappoint markets.
By RoboForex Analysis Department
Disclaimer:
Any forecast contained herein is based on the author's personal opinion. This analysis cannot be considered trading advice. RoboForex assumes no responsibility for trading results based on the trading recommendations and reviews contained herein.
