Alex Dudov
The EUR/USD pair is at a technically significant crossroads. After reaching highs near 1.20 earlier this year, the pair has retraced sharply, bringing price back into a demand area that many traders are watching closely. Whether this zone holds or breaks will likely define the pair's next directional move.
Order Block at 1.16 Holds as Key Demand Zone
The daily chart shows EUR/USD stabilizing near the 1.16 region, which aligns with a bullish order block formed during the earlier uptrend. Price previously broke market structure around 1.19, pushed into buy-side liquidity above 1.20, and then reversed. The subsequent decline swept sell-side liquidity before arriving at the current demand zone. As EUR/USD Liquidity-Driven Rally Analysis outlined, liquidity sweeps at key levels often precede strong directional moves, which gives the current setup added weight.
Right now, EURUSD is consolidating inside the order block rather than breaking below it. This kind of tight ranging at support is often a sign of institutional accumulation. EUR/USD Price Prediction: Targets Upside After Key Swing Low noted that similar consolidation near swing lows has preceded rebounds toward higher resistance levels, which in this case would put the upper liquidity zone above 1.20 back in play.
Macro Context and What Happens Next
The technical picture sits within a broader macro landscape still shaped by rate differentials, inflation data, and shifting risk sentiment. Euro-dollar remains sensitive to any developments that alter expectations around Federal Reserve or ECB policy. As covered in EUR/USD Price Analysis: Resistance Zone Signals Potential Pullback, order block structures and liquidity zones tend to act as reliable guides between support and resistance when broader momentum is aligned.
If buyers continue to defend the 1.16 demand zone, a recovery toward 1.19 to 1.20 becomes the base case. A clean break below the order block, however, would shift the structure bearish and open lower targets. For now, the balance of evidence favors the bulls holding this level, but confirmation on shorter timeframes would add conviction to any long setup from here.
Alex Dudov
