EUR/USD Weekly Price Analysis: Bullish Momentum Takes Pair Above 1.17 Resistance

EUR/USD weekly price analysis shows the pair broke decisively above the key 1.17 resistance level, finishing the week at 1.173 with a solid 1.67% weekly gain. The currency pair’s upward trajectory reflects a fundamental tug-of-war between expectations of European Central Bank’s cautious approach to rate cuts against the Federal Reserve’s increasingly dovish stance. This divergence in monetary policy outlook was reinforced by last week’s mixed U.S. inflation data and hawkish comments from several ECB officials.

EUR/USD 4-Hour Chart Analysis

The 4-hour chart displays a series of higher highs and higher lows as EUR/USD established a clear short-term uptrend, with price action confirming a bullish breakout above the previously contested 1.17 level. A notable order block has formed between 1.1680-1.1695, serving as a fresh demand zone after the recent breakout, while the previous resistance at 1.1650 has flipped to become near-term support with multiple touches confirming its validity.

Buy Prediction: Look for entries on pullbacks to the 1.1680-1.1695 demand zone, requiring confirmation from bullish engulfing candles or bull flags forming in this region. Target the 1.1780-1.1800 resistance with stops placed below 1.1660.

Sell Prediction: Counter-trend selling appears high-risk in the current momentum environment, but traders could watch for rejection candles at the 1.1780 level accompanied by bearish divergence on RSI for short-term scalping opportunities targeting a retest of 1.1700. Manage risk tightly as the overall trend remains bullish.

Daily Chart Analysis

The daily timeframe confirms EUR/USD’s bullish bias with price now trading comfortably above both the 50-day and 200-day moving averages, signaling strong institutional buying interest. Volume analysis shows accumulation on up days exceeding distribution on down days, while the pair has now cleared the major resistance zone that capped advances throughout March around 1.1650-1.1700.

Buy Prediction: Strategic long positions can be built on retracements to the 1.1620-1.1650 zone, confirmed by bullish daily candle closes above this range. Primary targets include 1.1850 followed by the significant 1.2000 psychological level.

Sell Prediction: Selling on the daily timeframe carries substantial risk given the established uptrend. Only consider short positions if price breaks and closes below the 1.1580 support level with increasing volume, which would indicate a potential trend reversal.

Weekly Chart Analysis

The weekly chart shows EUR/USD breaking out of a multi-month consolidation pattern, with last week’s strong candle suggesting institutional commitment to higher prices. The pair has now established support above the critical 1.15 level that served as resistance through much of Q1 2026, while weekly momentum indicators are trending positive without reaching overbought territory.

Buy Prediction: Major weekly retracements to the 1.1500-1.1550 zone represent high-probability position-building opportunities for longer-term traders, especially if supported by positive Euro-area economic data. Target the 1.2100-1.2200 range over a multi-week horizon.

Sell Prediction: Weekly timeframe selling is not advised given the clear breakout from the previous trading range and the strength of the current move. Only a fundamental shift in monetary policy divergence or a severe risk-off event would justify bearish positioning.

Monthly Chart Analysis

The monthly perspective shows EUR/USD potentially ending a larger corrective phase that began in mid-2024, with the pair now attempting to establish a new higher low above previous structural support. Central bank policy divergence appears to be the primary driver behind this potential long-term trend shift, with the ECB’s relatively hawkish stance compared to the Fed supporting Euro strength.

Buy Prediction: Deep monthly retracements to the 1.1350-1.1450 area would present exceptional long-term value for position traders, particularly if coinciding with oversold readings on monthly indicators. These investment-grade entries could target the 1.2500-1.2700 range seen in early 2024.

Sell Prediction: Monthly timeframe selling carries extreme risk given the potential trend reversal in progress. Only a catastrophic Eurozone economic crisis or dramatic shift in central bank policy differentials would justify considering bearish positions at this scale.

Technical Analysis

EUR/USD has established a clear break above the critical 1.17 handle, which had acted as a psychological resistance level throughout March. The Relative Strength Index (RSI) sits at 62 on the daily chart, showing strong momentum without yet reaching overbought territory. This technical positioning provides room for further upside before correction pressure builds.

Fibonacci retracement levels from the January 2026 high to the March low indicate the pair has now reclaimed the 61.8% retracement level at 1.1685, with the 78.6% level at 1.1830 serving as the next significant resistance. The bullish engulfing weekly candle that formed last week has set the stage for continued upward movement, though traders should be cautious of potential profit-taking as the pair approaches the 1.18 level. According to recent reports from FXStreet, the combination of waning dollar strength and positive European economic indicators has created favorable conditions for the Euro’s continued appreciation.

EUR/USD Fundamental Analysis

Monetary Policy Divergence: The ECB’s cautious stance on rate cuts compared to the Fed’s increasingly dovish outlook has strengthened the EUR/USD pair. Recent comments from ECB Governing Council members have emphasized inflation concerns, suggesting the ECB may delay rate cuts until later in 2026, while Federal Reserve officials have signaled readiness for multiple cuts if inflation continues to moderate.

Inflation Dynamics: U.S. inflation data last week showed a mixed picture with headline CPI slightly lower than expected but core measures remaining sticky, creating uncertainty around the Fed’s rate path. Meanwhile, European inflation has proven more stubborn, which has contributed to the ECB’s more hawkish positioning.

Economic Growth Indicators: European economic data has shown signs of improvement, with manufacturing PMIs exceeding expectations despite global economic headwinds. The relative economic performance between the Eurozone and U.S. will continue to influence EUR/USD movements.

Geopolitical Factors: Ongoing tensions in Eastern Europe and evolving trade relationships post-Brexit continue to influence EUR performance. Any escalation or resolution of these issues could serve as catalysts for significant price movements.

Weekly Outlook

Main Scenario: If EUR/USD maintains support above 1.1650 and successfully clears the 1.1780 resistance level, expect continuation toward the 1.1850 level followed by a test of the psychologically significant 1.2000 mark. This scenario carries approximately 65% probability based on current technical and fundamental factors.

Alternative Scenario: Failure to hold above 1.1650 or rejection at 1.1780 could trigger a correction toward the 1.1580-1.1600 support zone. This would likely represent a temporary pullback rather than a trend reversal unless accompanied by a fundamental catalyst shifting central bank policy expectations.

Traders should monitor this week’s European and U.S. economic data releases carefully, as they could provide confirmation for either scenario. Particularly important will be the upcoming Eurozone inflation figures and U.S. retail sales data, both of which could influence central bank policy expectations. The market’s current positioning suggests a preference for the Euro over the dollar in the near term, but volatility should be expected around key data releases.

EUR/USD continues its bullish momentum above the critical 1.17 level, backed by central bank policy divergence, though the steepness of the recent rally suggests potential for profit-taking pullbacks before further advances toward 1.20 can be sustained.