EUR/USD has declined to approximately 1.1500 during the early European session on Friday. The pair maintains a bearish sentiment in the short term, remaining below the 100-day SMA. The first upside barrier emerges at 1.1510; the initial support level is seen at 1.1425. The EUR/USD pair is positioned in negative territory, hovering around 1.1500 during the early hours of European trading on Friday. The Euro softens against the US Dollar as escalating tensions in the Middle East weigh on riskier assets. Iranian Parliament Speaker Mohammad Bagher Ghalibaf stated on Thursday that the United States will bear the consequences for the deaths of Iranian civilians, according to the source.
The Islamic Revolutionary Guard Corps announced on Thursday that it had conducted strikes against US bases located in Kuwait, Jordan, and Bahrain, following the bombing of a structure on Iran’s Qeshm Island by US forces. The Iranian military stated that the Strait of Hormuz would remain closed and that the “aggressor will be punished.” Stronger-than-expected Gross Domestic Product data from the Eurozone and Germany have reinforced expectations that the European Central Bank could deliver a second interest rate hike this year, potentially as soon as September. This, in turn, may assist in constraining the shared currency’s declines in the short run.
Brown Brothers Harriman’s Elias Haddad emphasises that the recent enhancement in Eurozone data is bolstering the argument for additional tightening of policy. He observes that “the recovery in Eurozone economic activity and above target inflation reinforces the case for the ECB to resume raising rates in September,” indicating that the interplay of stronger growth and ongoing price pressures maintains the central bank’s trajectory for another adjustment following its current hiatus. In the daily chart, EUR/USD remains constrained in the near term, as the spot price holds below the 100-day simple moving average and presses against the upper Bollinger Band, indicating that attempts at upward movement are encountering resistance. The Bollinger midline serves as a foundational element, while the Relative Strength Index hovering around 59 suggests a strengthening momentum that has yet to reach overbought territory, all within a generally limited context.
On the topside, immediate resistance is aligned at the upper Bollinger Band around 1.1510, with the 100-day SMA at 1.1570 serving as the next significant barrier that bulls would need to reclaim to alleviate the broader bearish pressure. On the downside, initial support is observed at the daily mid-Bollinger band near 1.1425, followed by the lower Bollinger Band around 1.1340. A breach of this level would likely intensify downside pressure and reopen the trajectory toward lower lows.