EUR\/USD weakened for a second day as a modest US dollar uptick followed rising inflation concerns tied to energy markets and escalating US-Iran tensions, which in turn supported expectations of further Federal Reserve tightening. The pair was trading around 1.1435, but the absence of sustained selling kept the latest retreat from Wednesday\u2019s near four-week high from gaining clear traction.<\/p>\n\n
Technically, the move above the 23.6% Fibonacci retracement of the April\u2013June decline lost momentum near the 200-period simple moving average on the four-hour chart. RSI sat near 50 while MACD edged slightly negative. Support is seen near 1.1330, while resistance stands at the 200-period SMA at 1.1477 and then the 38.2% retracement at 1.1508; a break higher could shift focus to 1.1563 and 1.1618.<\/p>\n\n
We recommend that derivative traders adopt a cautious, range-bound stance on EUR\/USD in the coming weeks as geopolitical tensions bolster the US dollar. With escalating US-Iran friction threatening key energy corridors, crude oil price fluctuations are reviving fears of persistent global inflation. This macro environment is currently supporting the greenback, keeping the EUR\/USD pair heavily pressured below the mid-1.1400s.<\/p>\n\n
Technically, we see the pair failing to break past its 200-period Simple Moving Average on the 4-hour chart near 1.1477. Because the Relative Strength Index is sitting right at a neutral 50, we suggest using short-term option straddles or iron condors rather than taking heavy directional risks. This neutral momentum indicates that the market is waiting for a clearer fundamental catalyst before breaking out.<\/p>\n\n
We advise keeping a very close eye on the vital structural support level at 1.1330, which has historically acted as a strong rebound zone. If sellers push the exchange rate below this floor, we could see a quick drop toward the 1.1200 level. On the flip side, we would need to see a daily close above the 38.2% Fibonacci retracement level of 1.1508 before we consider establishing any long-term bullish positions.<\/p>\n\n\n\n