Euro poised for critical moves as traders await ECB decision

The EUR/USD is trading notably lower on Thursday morning. The near-term outlook suggests euro weakness for the day ahead, as volatility is expected to increase amid the scheduled European Central Bank (ECB) meeting.

The currency pair experienced gains earlier in the week but reversed course after buyers failed to sustain upward momentum. Nonetheless, bulls are striving to maintain support above the 1.1500 level to prevent further bearish pressure and more significant selloffs. At the time of writing, the pair is trading near 1.1540.

Market Focus on ECB Decision and Press Conference

The rate hike is widely anticipated, with markets fully pricing in a 25-basis point increase at this week’s meeting following robust eurozone inflation data—the ECB’s first hike since 2023. Key attention will be on the ECB’s outlook regarding inflation, employment, economic projections, and remarks from ECB President Christine Lagarde. Her tone during the press conference will be as influential as the rate decision itself, especially given her recent indication that the central bank is likely to raise inflation forecasts at the upcoming monetary policy meeting. Against this backdrop, the EUR/USD pair is expected to experience heightened volatility during the New York trading session.

EURUSD Technical Forecast

Technically, on the downside, immediate support is located at 1.1500. A break below this level could see the pair move toward further support near 1.1470 and 1.1450, which is a key support zone for the week. Conversely, a rebound to 1.1570 is possible if the euro recovers, with additional resistance expected at 1.1600–1.1610. However, given the current bearish sentiment, these resistance levels may serve as potential selling points during rallies.

Summary: The euro must break and close above the 1.1650–1.1660 zone on the daily chart to signal a strong upward move. This resistance area remains critical in the near term; as long as prices stay below this level, the mixed trend is likely to persist despite any oversold bounce or short-term bullish activity at lower levels.

 

 

This marketing material is provided for informational purposes only and does not constitute investment advice, a recommendation, or an offer or solicitation to buy or sell any financial instruments.

Trading in securities involves significant risk and may not be suitable for all investors. Prices of securities may fluctuate significantly and may result in a total loss of your investment. Investors should be aware that losses may exceed potential profits when buying and selling securities. In certain market conditions, you may sustain losses that exceed your initial investment. Securities and contracts for differences are complex financial instruments that require a high level of knowledge and understanding. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.