Euro Surges, Dollar Stumbles – What’s Next for EUR/USD?

With the recent decline of the US dollar to its lowest level since November 2024, the euro has surged, reaching 1.09365 its highest level since November 2024. This rise is primarily driven by the recent weakness of the US dollar.

Possible Scenarios for EUR/USD in the Coming Period as per Technical Analysts:

Scenario 1: 

The pair continues its general upward trend, forming higher highs. A pullback to 1.08046 would be seen as a positive signal for further upside, targeting 1.09044. However, this scenario is relatively weaker due to the recent sharp rally in EUR/USD, which limits the bullish momentum.

Scenario 2:

If the price declines and closes below 1.07658 on a daily basis, this would signal a trend reversal from bullish to bearish, opening the door for further declines toward 1.06370 and 1.05592. A key confirmation for this bearish outlook in the short-to-medium term would be the RSI dropping below 50 and holding there.

Image 1: EURUSD, H4, Trading View

Market Watch:

Markets are awaiting the US Producer Price Index (PPI) monthly report today. Forecasts suggest a decline of 0.1%, bringing it to 0.3%, while the Core PPI is expected to remain stable at 0.3%. Any reading above expectations may be positive for the US dollar, impacting EUR/USD movements as per analysts.

Additionally, US jobless claims data will be released, with expectations of an increase from 221K to 226K. A further rise in jobless claims may be negative for the US dollar as per analysts!