EUR/USD Technical Analysis: Bearish Wave Structure Persists

EUR/USD Technical Outlook

The 4-hour EUR/USD chart currently indicates a shift in the wave structure, transitioning into a corrective pattern despite the long-term upward trend that originated in January 2025. While the primary trend remains intact, the current technical setup suggests the formation of a downward impulse, potentially representing wave C of a larger degree.

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Market participants are observing the development of a potential five-wave structure. Should this technical assumption hold, the pair faces downside targets below the 1.1400 level. However, a significant decline remains contingent on geopolitical developments, as market sentiment regarding the U.S.-Iran situation remains fluid.

Impact of Macroeconomic Data and Geopolitics

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The EUR/USD pair faced downward pressure on Tuesday, losing approximately 50 basis points during early U.S. trading hours. The release of UK unemployment data for March, which exceeded expectations, exerted additional pressure on European currencies, including the euro and the British pound.

Geopolitical tensions continue to weigh on the market, specifically regarding U.S.-Iran relations. Despite potential diplomatic negotiations, the lack of a clear ceasefire agreement keeps market participants cautious. Analysts are monitoring the 1.1578 level, which aligns with the 61.8% Fibonacci retracement, as a potential completion point for the current downward move if the structure proves to be an a-b-c correction.

Technical Summary and Projections

In the near term, technical indicators point toward the ongoing development of wave C, with projected targets near 1.1352, corresponding to the 38.2% Fibonacci level. Should this corrective phase conclude as an A-B-C pattern, the broader upward trend may resume. Traders are advised to maintain strict risk management protocols, as market volatility remains elevated due to geopolitical uncertainty.

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