**EUR/USD Price Forecast: Euro Steadies at 1.1736 with Bulls Eyeing 1.1916**
*By TradingNews.com Staff Writer (Credit: Original reporting by TradingNews.com)*
The EUR/USD currency pair has been a focal point for forex traders, especially in recent weeks as monetary policy signals, economic data, and shifting risk sentiment have driven volatility. As the euro steadied near the 1.1736 level, market watchers remain keenly interested in the possibility of a further bullish push towards the 1.1916 resistance, a key psychological and technical threshold. This article provides an in-depth analysis of the EUR/USD outlook, factors influencing the currency pair, and what traders can expect in the weeks ahead.
**Current Technical Overview: EUR/USD Clings to Support**
The EUR/USD rebounded from oversold levels earlier this month, consolidating just above 1.1700. The euro has shown resilience, with the 1.1736 level acting as a foothold. Technically, the pair’s fate pivots on the interplay between buyers defending this region and sellers eyeing further downside momentum.
Key near-term levels:
– Immediate support: 1.1736
– Next support zone: 1.1680–1.1700 (late July and August lows)
– Main resistance barriers: 1.1800 (psychological), then 1.1916
Recent price action shows the euro stabilized after several weeks of sustained selling pressure. Bulls, however, have not yet confirmed a reversal, with 1.1800 presenting the first significant test. A close above this level could draw in fresh buyers, aiming for the larger move to 1.1916.
**Fundamental Drivers: What’s Moving EUR/USD?**
The euro has faced several crosswinds, with both European and U.S. economic conditions feeding into the currency pair’s trajectory. Market themes currently dominating the narrative include:
**1. Divergent Central Bank Policies**
– The European Central Bank (ECB) has remained fairly dovish, with policymakers signaling that interest rate hikes remain some ways off. The ECB’s focus is on supporting the Eurozone’s economic recovery, keeping financial conditions accommodative.
– Meanwhile, the Federal Reserve’s recent hawkish tilt, with hints of tapering bond purchases sooner than previously expected, has underpinned the dollar, contributing to broad dollar strength in recent sessions.
– Any signals that the ECB may join global peers in tapering asset purchases, or that the Fed will delay normalization, could accelerate moves in either direction.
**2. Economic Data Flow**
– Eurozone GDP has shown steady improvement, but inflation remains subdued, limiting the ECB’s room for hawkish pivot.
– In the U.S., robust job growth and rising inflation have strengthened the case for policy tightening. However, weaker-than-expected data or signs of growth moderation could temper Fed enthusiasm and give respite to the euro.
– Ongoing supply chain disruptions, energy price shocks, and COVID-19 developments are material risks for both regions.
**3. Risk Sentiment and Safe-Haven Flows**
– Periods of market stress have tended to benefit the U.S. dollar at the euro’s expense, as investors flock to safe-haven assets.
– Calming geopolitical tensions, positive vaccine developments, or strong global equity markets usually favor the euro in risk-on environments.
**4. Political Developments**
– German elections, European fiscal stimulus progress, and U.S. budget and debt ceiling negotiations could introduce volatility.
– Any moves towards Eurozone fiscal integration, or a major shift in the U.S. fiscal outlook, might reset the medium-term balance of currency flows.
**Technicals in Focus: Pathways for Bulls and Bears**
Analyzing the technical landscape presents two competing scenarios for the EUR/USD pair.
**Bullish Scenario:**
– Pickup in Eurozone economic data surprises or ECB tone shift, leading to a decisive
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