EUR/USD Forecast Update – August 29, 2025
Adapted from the original analysis published by Economies.com
Overview
The EUR/USD pair continues to exhibit fluctuating behavior, impacted by macroeconomic factors including monetary policy decisions by the European Central Bank (ECB) and the Federal Reserve, geopolitical developments, and shifts in investor sentiment. As of today, August 29, 2025, the pair attempts to consolidate after a recent downturn. Market participants are evaluating whether the euro can regain footing following fundamental and technical pressures that have weighed on the pair.
This article provides an in-depth technical analysis of the EUR/USD pair, focusing on recent movements, key technical indicators, and potential trading strategies that traders should watch in the short and medium term.
Recent Price Behavior
In recent sessions, the EUR/USD pair tested the support zone around 1.0745. This level has proven resilient, acting as a psychological and technical support that prevented further depreciation of the euro against the US dollar. The pair showed a modest rebound but has faced continued selling pressure near resistance zones. Key highlights from recent price actions include:
– A descending trend dominating price movement since mid-August
– Short-term consolidation emerging around the 1.0745 support level
– Temporary rebounds failing to break past key moving averages
The price attempted to gather bullish momentum but lacks sufficient volume and conviction to claim strong upside movement. As long as the pair remains below specific resistance levels, the bearish outlook stays valid.
Technical Indicators Analysis
Traders often rely on a combination of technical indicators to assess potential trading opportunities. Here’s a breakdown of the major technical metrics relevant to the EUR/USD pair as of August 29, 2025.
Moving Averages
Moving averages provide insight into the current momentum and trend strength. Observations include:
– The 50-day Simple Moving Average (SMA) remains above the current price, signaling a prevailing short-term downtrend
– The 100-day and 200-day SMAs also hover above the price level, reinforcing long-term bearishness
– Short-term moving averages point downward, suggesting a continuation of downward momentum barring a fundamental shift
Relative Strength Index (RSI)
The RSI is a momentum oscillator that helps identify overbought or oversold conditions. Currently:
– RSI is hovering near the 40 level on the daily chart
– This suggests weak bullish momentum, with room for further decline before reaching oversold levels (typically below 30)
– The RSI neither confirms a clear reversal nor a complete bearish dominance, indicating a potentially range-bound market in the short run
MACD (Moving Average Convergence Divergence)
The MACD helps traders gauge the strength and direction of a trade. For EUR/USD:
– The MACD line remains below the signal line, a bearish indicator
– The histogram, which measures the difference between the MACD and its signal line, is still negative
– These signs align with a continued downtrend in the absence of major fundamental catalysts
Support and Resistance Levels
Identifying key levels is critical for managing risk and placing strategic trades. The primary zones to monitor for the EUR/USD pair include:
Support Levels:
– 1.0745: The immediate support level, tested multiple times and holding firm so far
– 1.0690: A lower support level, guarding the pathway toward 1.0635
– 1.0635: A crucial threshold that, if broken, could accelerate bearish sentiment
Resistance Levels:
– 1.0825: Short-term barrier recently rejected, capping bullish corrections
– 1.0890: A more significant resistance, aligning with Fibonacci retracement levels
– 1.0945: Site of a previous breakdown zone and an upper limit for bulls in the near-term
Price Behavior Scenarios
Based on the current technical and sentiment data, we can identify two main trading scenarios for EUR/USD:
Scenario 1: Continuation of Bearish Momentum
Read more on EUR/USD trading.