Eseandre Mordi
The euro is back under pressure against the U.S. dollar, showing fresh weakness after a brief recovery attempt. Technical indicators suggest the bearish momentum remains intact, with sellers keeping control below key resistance and pushing toward lower price zones.
Technical Analysis: Downward Momentum Takes Hold
The 8-hour chart reveals EUR/USD struggling to hold gains above 1.1640, facing repeated rejections around this level. Trader One of One pointed out this bearish setup, noting that EUR/USD sellers are "making money this week" — an observation that matches the chart's downward trajectory. Price action has formed a lower high, indicating the recent bounce was likely just a corrective move within the broader downtrend.
The chart shows a projected path toward 1.1600, 1.1577, and a primary target near 1.1542, aligning with previous swing lows. The structure suggests sustained selling pressure, with predominantly bearish candles and weak retracement moves signaling limited buyer interest. This technical picture points to a gradual decline rather than a sudden drop, reflecting controlled selling and room for additional downside if macro factors continue favoring the dollar.
Market Context: Dollar Strength Dominates
The bearish EUR/USD setup fits within a broader environment of U.S. dollar resilience, backed by solid economic data and elevated Treasury yields. Investors are sticking with the greenback on expectations that the Federal Reserve will keep rates higher for longer.
Meanwhile, the European Central Bank remains hesitant to tighten policy further given the eurozone's sluggish growth. This policy divergence continues weighing on the euro, making it difficult for the currency to sustain rallies even during temporary pullbacks. Traders are staying cautious about betting against the trend, choosing instead to follow the momentum that's been dominant since early October.
Key Levels to Watch
- Resistance Zone: 1.1640 – 1.1660
- Immediate Support: 1.1600
- Next Targets: 1.1577 and 1.1542
- Trend Invalidation: Above 1.1680
Path Toward 1.1540 Remains Clear
EUR/USD stays locked in a bearish pattern, with repeated failures to close above 1.1640 confirming the downtrend. The pair might see brief periods of consolidation, but unless strong bullish catalysts emerge — like unexpectedly hawkish ECB signals or disappointing U.S. data — the downside pressure looks set to continue. The 1.1540 zone now serves as the next logical target for sellers.
Eseandre Mordi
