During Asian trading on Monday, EUR/USD managed to recover from earlier losses, reaching around 1.1730. The rise in major currency pairs often follows a decline in the US dollar (USD).
As of now, the US Dollar Index (DXY)—which tracks the dollar’s value against six key currencies—was at approximately 98.45, a slight decrease of 0.06%. This index had opened significantly higher around 99.35 after the US called off its visit to Islamabad for peace talks with Iran, while Iranian Foreign Minister Seyyed Abbas Araghchi was in Pakistan for discussions.
In related news, Axios reported that Iran has put forth a new proposal to the US aimed at concluding the ongoing conflict, which includes reopening the Strait of Hormuz and delaying nuclear discussions. It seems that further nuclear talks will be contingent upon lifting the US blockade of that strategic waterway, indicating Iran’s willingness to resolve the escalating tensions in the Middle East.
This week, investors are preparing for potential fluctuations in major currency pairs, as both the Federal Reserve and the European Central Bank (ECB) are set to announce their monetary policies on Wednesday and Thursday.
EUR/USD Technical Analysis
Currently, EUR/USD is trading slightly above 1.1730. The pair remains above the 20-day exponential moving average (EMA) at 1.1696, which suggests that buyers are still in control after reclaiming this support level.
The Relative Strength Index (RSI) sits just above 50 at 54.9, indicating that bullish momentum is present but hasn’t peaked yet, as prices progress into the upper portion of the recent Fibonacci retracement grid.
Looking at resistance levels, immediate resistance is seen at the 50.0% Fibonacci retracement at 1.1749. A continued upward trend could target the 61.8% retracement at 1.1828, moving on to 1.1941, with a potential cycle high around 1.2085. On the flip side, initial support is at the 20-day EMA of 1.1696, with additional backing from the 38.2% Fibonacci level at 1.1670. If a more significant pullback happens, the 23.6% retracement at 1.1572 could come into play, before a stronger support near 1.1413.
(The technical analysis in this story was composed with the aid of AI tools.)
