Euro at Critical Demand – Is the Trend About to Flip?Euro reached an important zone for my setup, triggering a long position. Although it’s still trending below the fibcloud on the 4H timeframe, we’ve seen a solid 0.5% recovery from the recent low. I’m looking for this area to hold as support, with defined risk in case the setup invalidates.
Technicals:
• Price tapped into a major 4H support level where liquidity historically steps in.
• The current move marks a 0.5% bounce from the low, showing early signs of demand.
• Still trading below the fibcloud, but a reclaim of that zone would open the path toward 1.0850.
• Setup includes a stop-loss below the most recent wick low, with a clear structure to build a higher low.
Fundamentals:
EUR-side strength:
• ECB maintains a slower pace of rate cuts compared to the Fed.
• Growth and inflation in the Eurozone are still challenges, but the ECB’s hawkish stance continues to support medium-term EUR strength.
• The ECB may hike another 150 bps to reach a 4% terminal rate, which favors EUR upside.
USD-side risks:
• Trump announced plans to impose a 25% tariff on all car imports, including from the EU-adding geopolitical and trade uncertainty.
• Traders remain cautious around further escalation in US-EU trade tensions.
• US Initial Jobless Claims later today could bring weakness to the dollar if the data disappoints.
In short, while the USD remains resilient, the EUR fundamentals and the current technical zone make this a compelling spot for a bounce.
Note: Please remember to adjust this trade idea according to your individual trading conditions, including position size, broker-specific price variations, and any relevant external factors. Every trader’s situation is unique, so it’s crucial to tailor your approach to your own risk tolerance and market environment.
