**EUR/USD Weekly Technical Outlook (Original article by ActionForex)**
Source: ActionForex.com – “EUR/USD Weekly Outlook”
Original URL: https://www.actionforex.com/technical-outlook/eurusd-outlook/614394-eur-usd-weekly-outlook-430/
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The EUR/USD pair concluded last week with downward pressure reasserting itself, breaking through a key support level at 1.0795. This resumed the broader medium-term fall that began earlier this year. Foreign exchange traders saw euro weakness emerge, accentuated by a stronger U.S. dollar, driven in part by global rate policy divergence. With lingering uncertainty around ECB monetary policy versus expectations for the Fed, EUR/USD now looks poised to continue its bearish trend unless key reversal signals materialize.
### Short-Term Analysis: Bears Back in Control
EUR/USD extended its recent decline, breaking below support at 1.0795. This move reaffirms the pair’s interim top set at 1.1138 and confirms a broader correction from that level is in play.
– **Immediate resistance:** Located around 1.0884
– **Key support to watch next:** Zone around 1.0600, with further downside threat if it breaks
– **Momentum indicators:** Bearishly aligned, particularly with the daily Relative Strength Index (RSI) trending lower
The formation of lower highs and lower lows on the 4-hour and daily charts signals weakness in the bullish attempt to recover. With the zone near 1.0880 acting as a ceiling for now, EUR/USD could slip back toward stronger support zones in the 1.06 region if no bullish catalysts emerge.
### Weekly Chart Overview: Downside Continuation Likely
Taking a step back to the weekly timeframe, the latest candle reflects a strong downside reaction after earlier gains faltered. The weekly chart shows that the rebound to 1.1138 has likely completed as a corrective move. Medium-term trend structure continues to favor further downside.
– **Weekly MACD:** Signals a bearish crossover is in motion
– **Bearish target:** 1.0600-1.0515, previous lows from February and April 2024
– **Resistance on the weekly chart:** Remains firm near 1.0880 and the 38.2% Fibonacci retracement of the decline from 1.1138 to the latest low
As downside momentum increases, buyers appear to have limited influence for the moment. Renewed weakness solidifies the idea of a downtrend continuation phase rather than a rangebound correction.
### Medium-Term Trend: Reversal Confirmed
The medium-term bearish bias remains valid following the rejection at 1.1138. The pair had turned lower from this resistance zone earlier and the pullback accelerated this week, confirming the downtrend.
– **Trend direction:** Bearish from a medium-term perspective
– **Failed breakout:** 1.1138 high was unable to sustain, establishing a firm resistance ceiling
– **Next critical support level:** 1.0515, tested previously and marked by buying interest earlier this year
Price action suggests that the rally from the October 2023 low of 1.0447 to the December 2023 high of 1.1138 was merely corrective. The current leg lower is part of a deeper move that is likely targeting new cycle lows unless substantial buying support re-emerges.
### Longer-Term Structure: Focus on Macro Trends
Zooming out to the daily and weekly charts together, broader fundamentals and technicals continue to indicate more sustained downside for the common currency against the greenback. The ECB’s policy outlook versus the Federal Reserve remains divergent.
– **ECB policy signals:** Leaning toward holding rates or easing depending on inflation dynamics
– **Federal Reserve guidance:** Still cautious, but not committing to rapid rate easing
– **Bond yield differentials:** Favor the dollar as U.S. yields hold firm compared to Eurozone
Read more on EUR/USD trading.