EURUSD – Dollar Strength Still Sets the Direction

5 days ago

Considering both the news backdrop and the technical structure, I remain bearish on EURUSD. What stands out to me is not only the continued sequence of lower highs and lower lows, but also the relative advantage the U.S. dollar continues to hold as U.S. Treasury yields remain elevated. The euro has received a few positive catalysts, but so far they have mainly produced short-term recoveries rather than a meaningful change in the broader trend.

From a fundamental perspective, rising Eurozone inflation gives the ECB more reason to maintain a tighter monetary policy stance, while softer U.S. inflation data has reduced expectations for further aggressive Fed tightening. However, capital flows have yet to show a clear rotation from the USD into the EUR. As long as U.S. yields remain attractive and Europe continues to face pressure from elevated energy costs, I believe the dollar retains the stronger short-term foundation.

On the H2 chart, EURUSD continues to trade inside a descending channel and remains below the Ichimoku Cloud. The 1.1350–1.1380 area is the key zone I am watching, as resistance, the cloud, and the upper part of the bearish structure all converge there. If buyers fail to establish price above this area, another lower high could form, sending the pair back toward 1.1300 and potentially 1.1250 afterward.

Overall, I still see EURUSD as a SELL opportunity when the market offers a better price, rather than something to chase after an extended decline. My main strategy is to wait for a recovery toward 1.1350–1.1380 and watch for sellers to step back in. As long as the descending channel and Ichimoku continue to cap price, the short-term advantage remains with the U.S. dollar, and the broader EURUSD bias stays bearish.

3 days ago

Trade closed: target reached