EUR/USD Technical Analysis – July 31, 2025
By: Christopher Lewis, DailyForex.com
The performance of the EUR/USD currency pair continues to reflect the evolving dynamics of global monetary policy. Bulls and bears are currently battling for near-term control as macroeconomic data and central bank commentary steer sentiment. On July 31, 2025, the pair witnessed a measured move with mixed reactions from traders as the market assessed recent data from the eurozone and the United States.
This article delves into the technical setup of the EUR/USD pair, analyzing price action, support and resistance levels, moving averages, and potential future scenarios. It also considers macroeconomic and central bank narratives that influence currency strength on both sides of the Atlantic.
EUR/USD Price Action Overview
The EUR/USD currency pair showed a relatively muted session during early trading hours on July 31, 2025. The price hovered close to a key resistance area, indicating hesitation among traders as they await direction. Volatility remained compressed as market participants evaluated Eurozone CPI data and anticipated key U.S. labor market statistics scheduled later in the week.
Key highlights:
– The pair traded slightly below the 1.1000 psychological resistance level.
– Market participants exhibited caution ahead of important economic releases, leading to range-bound behavior.
– Traders continue to react to signals from the European Central Bank (ECB) and the Federal Reserve, with neither central bank giving fully clear forward guidance.
The 1.1000 level remains pivotal, having served as strong resistance on multiple occasions over recent weeks. Bulls have been attempting to break through and close above this level, indicating their desire to re-establish a medium-term uptrend. Bears, on the other hand, remain vigilant near resistance zones, selling into strength.
Technical Indicators and Analysis
From a technical standpoint, several factors are worth noting that may shape trading activity in the near term.
Moving Averages:
– The price is currently sitting just above the 50-day Exponential Moving Average (EMA), suggesting mild bullish momentum.
– The 200-day EMA lies farther below, indicating that longer-term trends might support strength in the euro, but confirmation is pending.
– The gap between the 50-day and 200-day EMA is not wide, hinting at a consolidatory phase rather than a sustained trend.
Support and Resistance Levels:
– Immediate resistance is pegged at the 1.1000 level. A convincing break above this may open the path toward 1.1050 and 1.1100, where bulls may gain strength.
– The nearest support area lies around the 1.0935 mark, which coincides with the 50-day EMA. Below that, support can be seen near the 1.0850 region.
– Deeper support is identified at the 1.0750 level, aligning closely with previous swing lows.
Momentum Indicators:
– The Relative Strength Index (RSI) is hovering near the 55 level on the daily chart, which remains slightly bullish but not overbought.
– The Moving Average Convergence Divergence (MACD) histogram is barely in positive territory, reflecting a lack of strong directional conviction.
– A crossover to the upside in MACD could mark an entry point for bulls; however, weak volume currently undermines this signal.
Candle Patterns:
– Price action on July 30 and 31 formed consecutive doji candles, which typically indicate market indecision.
– Previous bullish engulfing patterns failed to hold above resistance, reinforcing the significance of the 1.1000 level.
Fundamental Backdrop and Its Impact
The EUR/USD pair is heavily influenced by macroeconomic data on both sides, and several recent and upcoming releases are poised to affect market sentiment.
Eurozone Developments:
– Preliminary inflation figures from the eurozone showed Core CPI ticking slightly higher than expected at 2.8 percent annually.
– The ECB has struck a more neutral tone recently, suggesting that interest rates may stay on hold unless inflation
Read more on EUR/USD trading.