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EUR/USD Price Forecast: Resumes downside after failing to hold above 200-day EMA
- EUR/USD trades marginally lower around 1.1520 as the US Dollar remains firm amid Middle East conflicts.
- Peace mediators dismiss Trump’s claim that the 10-day halt to attacks on Iranian energy plants was ordered as per Tehran’s request.
- ECB’s Lagarde warns of persistent energy supply risks due to significant damage to Gulf energy infrastructure.
The EUR/USD pair trades subduedly around 1.1520 during the European trading session on Friday. The major currency pair faces slight selling pressure as the US Dollar (USD) trades firmly with hopes of a de-escalation in the Middle East war easing, which involves the United States (US), Israel, and Iran.
During the press time, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades 0.1% higher to near 100.00.
Investors turn doubtful over Mideast optimism amid the conflicting statements from peace mediators on US President Donald Trump’s claim that he ordered a pause on planned military strikes on Iran’s power plans as per Tehran’s request.
According to the Wall Street Journal (WSJ), peace talks mediators dismissed claims that Iran had requested a 10-day pause on strikes on its energy plants.
On the Euro (EUR) front, the major currency is expected to remain under pressure amid fears of persistent energy supply disruption in the wake of damage to Gulf energy infrastructure amid the war.
European Central Bank (ECB) President Christine Lagarde said in an interview with the Economist that the negative energy shock to the world economy from the Mideast war would be larger than current projections, as too much energy infrastructure has been damaged.
EUR/USD technical analysis
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EUR/USD trades lower at around 1.1520 as of writing. The pair holds just above the 200-day EMA near 1.1540 while extending a sequence of lower highs below the 20-day EMA around 1.1590, keeping the near-term bias modestly bearish within a broader sideways context.
The 14-day Relative Strength Index (RSI) struggles to hold its recovery move into the 40.00-60.00 zone, signifying heavy selling pressure at higher levels.
Immediate resistance emerges at the 20-day EMA around 1.1590, with a daily close above this barrier needed to ease bearish pressure and open a move toward 1.1690. A stronger recovery would then target the 1.1810/1.1850 area, where prior highs cluster and the recent breakdown began. On the downside, initial support is located at 1.1500, guarding the late pullback low at 1.1415. A decisive break below 1.1415 would confirm a continuation of the downswing and expose the next support zone closer to 1.1350, where longer-term buyers would be expected to re-emerge.
