Market experts at Kepler Group examine the latest EUR/USD technical picture, as the pair remains confined to a tight range ahead of a critical US inflation report.
Pair Holds Steady As Dollar Stabilizes Near Recent Lows
EUR/USD fluctuated on Tuesday, holding within the range seen over the past week. At the time of writing, the pair trades around 1.1546, virtually unchanged on the day. This lack of direction unfolds as the greenback finds its footing near multi week lows, with market participants keeping a close watch on the Middle East situation, especially any progress toward reopening the Strait of Hormuz.
Attention also turns to Wednesday’s US Consumer Price Index data, which could shape Federal Reserve rate expectations ahead of the September meeting and ultimately drive the next move in both the US Dollar and EUR/USD.
Commerzbank Sees Euro Grinding Higher Over The Medium Term
Commerzbank takes a more constructive medium term view, expecting the pair to build fresh momentum once the current geopolitical strain fades, pointing to why they believe this shift is likely.
The bank also points to the broader policy rate backdrop, expecting US interest rate expectations to correct further downward in the coming months, which would weigh on the dollar.
Reflecting these factors, Commerzbank has trimmed but maintained a constructive medium term profile for the pair, now projecting EUR/USD to reach 1.18 by mid-2027, down slightly from a previous forecast of 1.20. Looking further out, the bank expects a gradual rise toward 1.19 by the end of 2027, compared to an earlier forecast of 1.21.
Technical Structure Points To A Neutral Near-Term Bias
EUR/USD is currently hovering between its short and longer term moving averages, maintaining a broadly neutral near term bias. The daily RSI sits near 59, a reading that still points to buyers being active beneath the surface, while the MACD line holds in positive territory, pointing to a cautiously bullish undertone even with several resistance layers still overhead.
This combination of range bound price action alongside constructive momentum indicators suggests the market may be building energy for a more decisive move, even though the immediate technical picture remains contained within familiar boundaries.
Key Support Levels To Watch
On the downside, initial support is seen at the 50 day SMA, currently positioned at 1.1468. Below that, a horizontal floor sits at 1.1400, with a deeper structural base located near 1.1350. These layered support levels provide multiple potential zones where buyers could step back in should the pair see renewed selling pressure.
A break below 1.1350 would represent a more meaningful shift in the technical picture, potentially opening the door to a deeper corrective phase beyond the current trading range. Until then, these support levels are likely to continue serving as reference points for traders looking to gauge the strength of any pullback.
Resistance Levels Define The Path Higher
On the topside, immediate resistance is located at the 100 day SMA, currently at 1.1567, with a more significant barrier found at the 200 day SMA near 1.1630. Clearing both levels decisively would likely be the trigger needed for a stronger bullish phase, whereas an inability to do so would keep the pair trapped in its recent sideways pattern.
Traders often watch volume alongside these levels for added confirmation of any breakout.
Should EUR/USD fail to clear this resistance cluster, the pair would likely remain confined within its current range, continuing the sideways pattern that has characterized recent trading sessions. Traders watching this setup closely will likely view a decisive close above 1.1630 as the clearest signal that the broader trend is shifting in favor of the euro.
Conclusion
EUR/USD remains technically balanced between constructive momentum indicators and a well defined trading range bounded by the 100 day and 50 day SMAs. Wednesday’s US CPI data looms as a critical near term catalyst, with the potential to shape Federal Reserve rate expectations and determine whether the pair can break free from its current sideways pattern.
Longer term, Commerzbank’s constructive outlook, anchored by expectations of continued dollar weakness and gradual Fed independence erosion, suggests scope for further euro strength into 2027.
Traders following EUR/USD strategies should watch closely how price reacts around the 1.1567 and 1.1630 resistance levels in the sessions ahead, as a decisive break in either direction would likely set the tone for the pair’s next major move.