Victoria Bazir
The EUR/USD currency pair has entered a consolidation phase after a sharp decline earlier this week. Price action is now hovering in a tight range, with traders watching for a breakout that could signal the next major trend.
Euro-Dollar Stabilizes After a Sharp Decline
The pair has paused its downward momentum and is currently testing the waters around 1.1600. Trader Sham recently pointed out on the 4-hour chart that the euro is showing early signs of stabilization, though a decisive reversal hasn't materialized yet.
The chart shows a clear downtrend from mid-October, marked by lower highs. However, the pair now seems to be forming a short-term base around 1.1580, suggesting that selling pressure is easing while buyers are trying to step in. Resistance near 1.1620 remains stubborn—it's been tested multiple times without a clean break above. This narrow range is typical of consolidation phases that often come before bigger moves.
Key Technical Levels
The 4-hour structure shows an orderly pullback from 1.1720 down to 1.1580, followed by sideways movement with low volatility. This pattern reflects market indecision as traders digest recent economic data before committing to new positions. Key levels to watch include: resistance around 1.1620 where price has been rejected twice, support near 1.1580 where buyers have consistently defended, and a trend bias that remains mildly bearish unless we see a strong close above 1.1620. If the pair breaks above 1.1620 with conviction, the next target sits near 1.1680—a previous breakdown zone. On the flip side, if 1.1580 fails to hold, we could see a move toward 1.1540.
Macro Drivers Behind the Range
The euro's lackluster performance reflects broader economic uncertainty. The dollar is getting support from elevated Treasury yields and the Fed's hawkish stance, while the eurozone is sending mixed signals with modest growth but sticky inflation. Market participants are sitting on their hands ahead of upcoming ECB statements and U.S. data releases. Until those catalysts arrive, EUR/USD will likely stay locked in this range, with traders playing short-term bounces rather than taking big directional bets.
Victoria Bazir
