EUR/USD Technical Analysis: Key Fibonacci Levels and Macro Outlook

Technical Overview and Hourly Price Action

The EUR/USD pair recently retreated from the 50.0% Fibonacci retracement level at 1.1745, suggesting a potential move toward the 38.2% level at 1.1666. If the pair manages to consolidate back above 1.1745, the technical outlook would shift in favor of the euro, targeting the 61.8% retracement level at 1.1824.

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On the hourly chart, the current wave structure remains structurally bullish, as previous peaks have been surpassed and recent lows have not been breached. While a temporary stabilization in geopolitical tensions between Iran and the United States has supported the euro, any deterioration in this background could quickly strengthen bearish sentiment and test the current trend.

Macroeconomic Drivers and Central Bank Meetings

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The economic calendar has been relatively quiet following Germany's GfK consumer confidence index, which fell short of expectations. Traders appear to be in a holding pattern as the market prepares for a high-impact week featuring Q1 GDP data, inflation reports, and the ISM index. Furthermore, policy meetings from the Federal Reserve, the European Central Bank, and the Bank of England are expected to drive significant volatility.

Geopolitics remains a critical factor in market sentiment, with the Middle East conflict continuing to influence risk appetite. Analysts suggest that while monetary policy and economic data are vital, the near-term trajectory of the euro and U.S. dollar may remain highly sensitive to regional developments in Iran.

4-Hour Chart and Sentiment Analysis

On the 4-hour chart, the pair has consolidated above the 61.8% Fibonacci level at 1.1706. This positioning suggests a possible extension of growth toward the 50.0% level at 1.1778. However, a move below 1.1706 would favor the U.S. dollar, opening the door for a decline toward the 76.4% retracement level at 1.1617.

The latest Commitments of Traders (COT) report indicates a resurgence in bullish activity. Speculators opened 2,768 long positions and closed 12,538 short positions during the reporting week. Total long positions now stand at 217,000 against 176,000 short positions, widening the gap in favor of the euro and reflecting sustained interest from major market participants.

Forecast and Trading Levels

Short-term trading strategy involves monitoring the 1.1745 level; a rebound from this resistance favors targets at 1.1666 and potentially 1.1568 upon further breakdown. Conversely, buying opportunities are signaled by a close above 1.1745, targeting 1.1824, or a successful rebound from the 1.1666 support area.

For the upcoming sessions, investors should keep a close eye on the U.S. ADP Employment Change report and a scheduled speech by ECB President Christine Lagarde. While these are secondary events, they may provide directional cues ahead of the more significant central bank decisions later in the week.

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