**Is the EUR/USD Top In? Watch These Key Levels**
*Original analysis by Justin Bennett, Daily Price Action*
The EUR/USD pair remains a focal point for traders worldwide, as recent moves have raised the question: has EUR/USD topped out, or is more upside in store? Price action over recent months has painted an intriguing technical picture, suggesting potential turning points are near. In this in-depth article, we break down the pair’s technical landscape, highlight critical support and resistance levels, and analyze what traders should watch for in the weeks ahead.
## Overview of EUR/USD Recent Price Action
Since late 2023, EUR/USD has been caught in a tug-of-war between bears and bulls. The pair rallied from lows near 1.0450 to highs around 1.1138 in December. However, momentum has since shifted, and the pair struggled to clear key resistances multiple times. This repeated rejection is the very reason traders are asking if the top is in for EUR/USD.
Several factors have influenced EUR/USD’s movement:
– Diverging monetary policies between the Federal Reserve and European Central Bank
– Shifting risk sentiment in global markets
– Ongoing macroeconomic data from both the US and Eurozone
While fundamentals are crucial, technical analysis gives us insight into current market behavior and likely path forward.
## Key Technical Levels to Watch
Technical analysis reveals that EUR/USD is currently consolidating below major resistance. Let’s outline the key areas traders must monitor:
### 1. Resistance at 1.1138
– The December 2023 high at 1.1138 marks strong resistance and the multi-month top
– Gains above this level would open the door to a significant breakout, potentially targeting 1.1270 or higher
### 2. Minor Resistance Near 1.0980–1.1000
– Psychological and historical significance for round numbers like 1.1000
– Sellers have defended this area on several occasions in early 2024
### 3. Critical Support at 1.0830
– The 1.0830 level has acted as support on several daily closes
– Failure to hold above here would be an early sign of bearish momentum returning
### 4. Key Support at 1.0720
– The 1.0720 area aligns with previous swing lows and a horizontal level that has capped declines several times
– A confirmed daily close below 1.0720 signals a shift in market structure, with potential for a deeper pullback
### 5. Multi-Month Support Trend Line
– If you draw a trend line from September 2022 lows through the March 2023 swing lows, EUR/USD is approaching this dynamic support
– Watching for a bounce or break at this trend line is crucial
## Price Action: Is the EUR/USD Top in Place?
Based on the evidence, EUR/USD is showing signs that a top may be in, at least for the short to medium term. Here’s why:
– Lower highs have formed since the December peak at 1.1138
– Each rally attempt has stalled below previous resistance, showing waning bullish momentum
– The pair is pressing into critical support zones, testing buyer conviction
This does not mean the pair cannot rebound in the short term. Instead, it signals that sellers are gradually gaining control, and that momentum is favoring a potential downward break.
## What to Watch: Scenarios for EUR/USD
Traders should prepare for either direction, watching price action as the deciding factor:
### Bullish Scenario
– A daily close above 1.1000, and especially a weekly close above 1.1138, would invalidate the topping thesis
– Such a move would suggest renewed demand, likely targeting the following levels:
– 1.1200 as a near-term resistance
– 1.1270 as the next major upside target
### Bearish Scenario
– A breakdown
Read more on GBP/USD trading.