The pair traded near 1.1430 on Tuesday. The US dollar is updating its March 2026 highs, supported by expectations of further tightening of monetary policy by the Federal Reserve, as well as cautious optimism surrounding US-Iran negotiations.
An additional factor for the markets was Washington's decision to grant Tehran a 60-day temporary license to export oil to world markets. The move reinforced expectations of a gradual recovery in global crude oil supplies and was seen as a sign of progress in talks between the two sides.
The Federal Reserve remains the key focus for investors. After the hawkish signals conveyed at the June meeting, markets continue to discount the likelihood of a rate hike as early as September. Major banks, including Deutsche Bank and Bank of America, have also revised their forecasts in favor of further tightening monetary policy.
The key event this week will be the release of the PCE index, the Federal Reserve's preferred inflation gauge. The report may provide new signals about the persistence of price pressure in the US economy and influence expectations about the future path of interest rates.
EUR/USD Technical Analysis
On the EUR/USD H4 chart, the market has formed a consolidation range around 1.1444 today. At the moment, the range has widened down to 1.1418 and up to 1.1440. If the pair breaks out of this range to the upside, a corrective wave may develop towards 1.1470. After that, a drop towards 1.1385 is expected.
If the pair breaks directly lower, it will open the possibility of a bearish wave towards 1.1315.
Technically, this scenario is confirmed by the MACD indicator: its signal line is below the zero level and pointing firmly downwards, reflecting persistent bearish momentum with potential for the downtrend to continue.
According to the first half chart, the market has completed the structure of another growth wave towards 1.1449. A consolidation range is currently forming below this level. Today, the range may expand down to 1.1409 and up to 1.1444. After that, a drop towards 1.1385 is expected.
The stochastic oscillator supports this scenario: its signal line is below 50 and pointing firmly towards 20.
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.
