EUR/USD Movement Summary

During the Asian trading session on Thursday, EUR/USD saw some buying interest, pulling away from its recent lows around 1.1480-1.1475 observed since late March. A notable drop in the US dollar led to a rise in the exchange rate, reaching a peak close to 1.1525 within the last hour.

The renewed investor confidence is linked to the US-Iran agreement aimed at easing tensions and reopening the Strait of Hormuz. This has encouraged some profit-taking in the US dollar, which had just achieved its highest value since late March on Wednesday. Moreover, the European Central Bank’s (ECB) hawkish hints have provided additional backing for the euro. However, increasing expectations for a potential interest rate increase by the US Federal Reserve in December may curb any losses for the dollar and weigh on the currency pair.

From a technical standpoint, the current exchange rate remains significantly below the 200-period simple moving average (SMA) on the 4-hour chart, indicating a bearish sentiment in the near term. The Moving Average Convergence Divergence (MACD) is in negative territory, while the Relative Strength Index (RSI) sits around 38. These momentum indicators collectively imply ongoing downward pressure, despite EUR/USD striving to stabilize above its recent lows.

Any future rallies might encounter resistance near the 1.1575-1.1580 horizontal support level, leading up to the 1.1600 mark. Conversely, the 200-period SMA at 1.1638 presents a significant hurdle that buyers must clear to shift the current bearish trend and pave the way for a more robust recovery. On the downside, if EUR/USD falls below the 1.1500 threshold, it could potentially decline further.