EUR/USD Tests Key Support as Bullish Channel Faces Breakdown Risk

Economic

Summary:

The EUR/USD pair ekes out modest gains after a sharp fall, weighed by surging oil prices, escalating Middle East conflict, and looming Federal Reserve policy risks.

BUY EURUSD

Close Time

CLOSED

1.15216

Entry Price

1.16500

1.14300

1.16671 +0.00245 +0.21%

74.6

Pips

Profit

1.14300

1.15962

Exit Price

1.15216

Entry Price

1.16500

The euro has managed to claw back minor gains against the U.S. dollar on Wednesday, trading near 1.1500, as the common currency attempts to recover from Tuesday’s sharp sell-off. However, any meaningful upside remains elusive, with a cocktail of geopolitical instability, rising energy costs, and investor caution ahead of the Federal Reserve’s policy decision all limiting the rebound.

On Tuesday, EUR/USD suffered a steep drop, driven largely by market jitters over growing tensions in the Middle East. As the Israel-Iran conflict drags into its sixth consecutive day, financial markets have become increasingly risk-averse. U.S. officials have ratcheted up their rhetoric, with speculation swirling that President Donald Trump is considering direct military action to force a complete dismantling of Iran’s nuclear ambitions. That prospect has sharply heightened fears of regional escalation.

In response, Iran’s ambassador to the United Nations warned that Tehran would retaliate to any U.S. strike, a statement that deepened concerns across global markets. With geopolitical risk premiums rising, investors are pouring into traditional safe havens—chief among them the U.S. dollar—undermining demand for the euro.

The impact of this geopolitical overhang is further compounded by a surge in oil prices. Brent crude jumped more than $3 on Tuesday, nearing $75 per barrel—marking a stunning 16% rally since May. For the Eurozone, which is a net energy importer, elevated crude prices translate into rising input costs and margin compression across industrial sectors, thus adding a layer of downside risk to an already fragile economic outlook. Higher oil prices threaten to stall consumer demand and further dampen growth across the bloc, keeping the euro under pressure.

Meanwhile, the latest Eurozone CPI data offered little reprieve. Final consumer price index figures confirmed earlier estimates, indicating a deceleration in inflationary pressure. While a moderation in inflation might typically be seen as a relief, in the context of slowing growth and a potentially more dovish European Central Bank (ECB), the subdued inflation data failed to support the euro. With the ECB unlikely to pivot hawkishly in the near term, rate differentials between the euro and dollar continue to favor the greenback.

Market participants are now firmly focused on the Federal Reserve’s interest rate decision scheduled for later Wednesday. Although the Fed is widely expected to hold rates steady, traders are laser-focused on the central bank’s updated projections and “dot plot,” which could recalibrate expectations around future rate moves. Chairman Jerome Powell’s press conference will be scrutinized for signals on how the Fed intends to navigate the conflicting dynamics of slowing U.S. growth and stubbornly high inflation.

A hawkish tilt in Powell’s comments—particularly if accompanied by upward revisions to inflation forecasts—could reenergize the dollar and spell further trouble for the euro.

Technical Analysis

From a technical standpoint, the EUR/USD pair is showing early signs of a tentative bounce after finding support around the 1.1450–1.1500 area. Tuesday’s fall saw the pair lean into its 50-period Exponential Moving Average (EMA50), which has provided a soft floor for now.

The Relative Strength Index (RSI) has started to curve up from oversold territory, suggesting the potential for a short-term rebound. Price action continues to hover within a broad ascending channel that has defined the pair’s structure in recent weeks. The current zone being tested represents a confluence of technical interest: it aligns with the lower boundary of the channel, a notable liquidity cluster, and the key 0.5–0.618 Fibonacci retracement level of the latest upswing.

This area could offer a compelling entry point for bulls—if the pair manages to hold above it and posts a bullish confirmation candle. Should that occur, the next logical upside target would be the 1.1650 level, which marks the upper range of recent consolidation and coincides with the previous week’s highs.

However, the technical outlook will quickly sour if the euro fails to defend this support zone. A clear breakdown below the channel and the Fib cluster would invalidate the short-term bullish thesis and potentially open the door for a deeper correction toward the 1.1350–1.1400 area.

TRADE RECOMMENDATION

BUY EURUSD

ENTRY PRICE: 1.1520

STOP LOSS: 1.1430

TAKE PROFIT: 1.1650

Risk Warnings and Disclaimers

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Warren Takunda

Traders' Opinions

Economic

Summary:

GBP/USD rebounds to 1.3452 as investors weigh weak U.S. housing data and rising jobless claims. UK core inflation eases to 3.5%, with both the Fed and BoE expected to hold interest rates.

BUY GBPUSD

Close Time

CLOSED

1.34800

Entry Price

1.36000

1.34000

1.33441 +0.00129 +0.10%

10.5

Pips

Profit

1.34000

1.34905

Exit Price

1.34800

Entry Price

1.36000

The British Pound regained modest ground on Wednesday, inching up to 1.3452 against the U.S. Dollar, as currency markets navigated a raft of economic releases and braced for pivotal decisions from two of the world’s most influential central banks. With tensions escalating in the Middle East and risk sentiment wobbling, GBP/USD’s 0.19% climb reflected cautious optimism rooted in softer U.S. data and the cooling trajectory of British inflation.

While the recovery in the Pound was moderate, it came at a time when traders are increasingly focused on the forward guidance set to emerge from the U.S. Federal Reserve and the Bank of England. Both institutions are widely expected to maintain current interest rates this week, but the tone of their communications and the latest updates to economic forecasts may carry substantial weight in shaping the summer trading landscape.

In the U.S., the economic picture is growing murkier. Weekly jobless claims rose by 245,000 for the week ending June 14, matching consensus estimates but continuing a recent trend of gradual deterioration in the labor market. More concerning for markets was the sharp pullback in housing activity. May’s housing starts plummeted nearly 10% month-on-month to 1.256 million units—well below April’s 1.392 million print—marking the steepest monthly decline since last summer. Building permits also edged down 2%, signaling a broader slowdown in construction and housing investment.

These figures add further complexity to the Federal Reserve’s policy calculus. While inflation in the U.S. has been stickier than anticipated, signs of cooling in housing and labor markets could reignite discussions about the timing of rate cuts later in the year. Still, Fed Chair Jerome Powell and his colleagues are expected to keep the benchmark federal funds rate steady in tonight’s announcement. More importantly, attention is squarely on the updated "dot plot" of rate projections, which could signal if officials see room for even one or two rate cuts in 2024.

Market participants are particularly sensitive to any hawkish tilt, especially given that just two policymakers moving their dots higher could shift the median view toward more restrictive policy. With inflation still above target and global risks intensifying, the Fed faces a delicate balancing act.

Across the Atlantic, the latest data from the Office for National Statistics (ONS) offered some relief for the Bank of England. Headline CPI held steady at 3.4% year-on-year in May, matching expectations, while core inflation—which strips out volatile food and energy prices—slipped from 3.8% to 3.5%. This moderation, though incremental, is encouraging for policymakers who have been reluctant to commit to any imminent easing despite growing market pressure.

For now, traders expect the BoE to hold its benchmark rate at 5.25%, with swap markets pricing in the first 25 basis point cut by September, followed by another in December. However, with wage growth still robust and services inflation proving sticky, the Monetary Policy Committee may opt for a cautious tone. A single dissenting vote in favor of a hike or strong inflation warnings in the meeting minutes could douse market expectations of a dovish pivot.

Adding a layer of uncertainty to the macroeconomic narrative is the renewed escalation between Israel and Iran. U.S. President Donald Trump’s recent remarks hinted at dwindling patience and potential American involvement in the conflict. Markets remain on edge, with risk assets treading water and defensive trades finding renewed interest. While there has been no official military response from Washington, the geopolitical backdrop has kept the Dollar bid and weighed slightly on risk-sensitive currencies like the Pound.

Technical Analysis

From a technical standpoint, GBP/USD’s recent move appears more corrective than impulsive. After briefly dipping to a two-week low around 1.3410, the pair bounced modestly, though it continues to trade below key resistance levels. The Relative Strength Index (RSI) has edged above the neutral 50-mark, currently reading at 47, suggesting limited momentum.

To re-establish a bullish trend, the Pound must convincingly break above the psychological 1.3500 threshold. A successful breach would likely expose the 20-day Simple Moving Average at 1.3531, with further upside capped near 1.3600. On the downside, 1.3410 remains the immediate support, and a failure to hold above it could trigger a deeper retracement toward 1.3360.

TRADE RECOMMENDATION

BUY GBPUSD

ENTRY PRICE: 1.3480

STOP LOSS: 1.3400

TAKE PROFIT: 1.3600

Risk Warnings and Disclaimers

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Alan

Forex

Central Bank

Summary:

The Swiss National Bank (SNB) will announce its latest interest rate decision tomorrow. While the market expects a 25-basis-point rate cut, there remains a possibility of an unexpected reintroduction of negative rates.

BUY USDCHF

Close Time

CLOSED

0.81738

Entry Price

0.83900

0.80200

0.80292 -0.00163 -0.20%

7.4

Pips

Profit

0.80200

0.81812

Exit Price

0.81738

Entry Price

0.83900

Fundamentals

As of the European trading session, USD/CHF is trading at 0.8160, down 0.05% on the day. Market focus today centers on the SNB's rate decision scheduled for tomorrow (June 19th). The consensus anticipates a 25-basis-point cut to 0%, but uncertainty around the policy path has heightened depreciation pressure on the Swiss franc.

A Reuters poll shows that 27 out of 30 economists expect the SNB to cut rates to 0%, while three foresee a potential resumption of negative rates at -0.25%. A rate cut would further narrow the CHF's interest-rate advantage, diminishing its appeal. Though the franc retains its long-term status as a safe-haven currency, near-term policy easing expectations may weigh on its strength. Meanwhile, Switzerland's May CPI fell 0.1% year-on-year, intensifying deflationary risks and providing data-driven justification for monetary easing.

Technical Analysis

Will the Swiss National Bank Reintroduce Negative Rates?_1

Based on the daily chart, USD/CHF enters a key support zone after recent consecutive declines. A double-bottom pattern is formed near 0.8060, with short-term upward momentum gradually emerging. Additionally, the pair has closed higher for three consecutive sessions, confirming the validity of the double-bottom support and suggesting further potential gains.

The USD/CHF is currently facing resistance at 0.8190. A decisive break above this level could pave the way for a test of the 0.8400-0.8475 resistance zone.

Buying at lows is recommended.

Trading Recommendations

Trading direction: Buy

Entry price: 0.8160

Target price: 0.8390

Stop loss: 0.8020

Valid Until: July 2, 2025, 23:00:00

Support: 0.8085/0.8036

Resistance: 0.8190/0.8400

Risk Warnings and Disclaimers

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Manuel

Central Bank

Economic

Summary:

The renewed interaction with this support zone may lay the groundwork for another potential bullish rebound. If momentum builds, the first resistance to watch lies around 1.3522.

BUY GBPUSD

Close Time

CLOSED

1.34292

Entry Price

1.35220

1.33700

1.33441 +0.00129 +0.10%

29.5

Pips

Profit

1.33700

1.34587

Exit Price

1.34292

Entry Price

1.35220

This week’s economic calendar places the British Pound (GBP) and U.S. Dollar (USD) under the spotlight, as traders brace for two high-impact events. The UK’s Consumer Price Index (CPI) report is set to be released on Wednesday, just one day ahead of the Bank of England’s (BoE) pivotal monetary policy decision. These data points are likely to shape expectations surrounding the future path of UK interest rates and could be decisive for the short-term direction of the Pound.

At the same time, the U.S. Federal Reserve will announce its own rate decision on Wednesday. This could provide a fresh catalyst for the greenback, with any hawkish surprises potentially triggering sharp moves in the GBP/USD pair. In the background, markets remain cautious amid rising speculation that the BoE may deliver rate cuts sooner and more aggressively than previously expected—an outlook reinforced by recent figures showing the UK economy contracted more than anticipated in April. These headwinds have weighed on the Pound’s performance and contributed to increased volatility across GBP crosses.

Meanwhile, the latest U.S. data has continued to present a mixed macroeconomic picture. Retail sales fell by 0.9% in May, the steepest drop in four months, reflecting cautious consumer behavior amid rising uncertainty linked to potential new tariffs. However, the Retail Sales Control Group—which feeds into GDP—posted a stronger-than-expected 0.4% increase, offering some resilience. Industrial production, however, slipped by 0.2%, undershooting forecasts and highlighting ongoing weakness in U.S. manufacturing output.

Geopolitical tensions have also re-entered the spotlight. U.S. President Donald Trump issued sharp warnings to Iran, demanding an “unconditional surrender” and the dismantling of its nuclear program. Praising recent Israeli airstrikes as "excellent" and "very successful," Trump suggested that future operations could be even more intense unless Tehran agrees to a deal. Speaking from Air Force One after the G7 summit, he made it clear that he is not interested in temporary truces, but rather in achieving a complete end to Iran’s nuclear ambitions. "They should have taken the deal… I'm not in the mood to negotiate," he added.

On the inflation front, the U.S. Producer Price Index (PPI) for May offered further signs of cooling price pressures. Headline PPI rose 2.6% year-over-year, slightly above April’s 2.5% and in line with expectations. However, the core PPI, which excludes volatile components like food and energy, eased to 3.0% from the prior 3.2%, reinforcing the broader narrative that underlying inflation is gradually declining. Major Support in Focus as GBPUSD Eyes a Potential Rebound_1

Major Support in Focus as GBPUSD Eyes a Potential Rebound_1

Technical Analysis

From a technical perspective, GBP/USD has once again revisited a strong support zone around the 1.3419 area—a level last tested on May 28. Following that earlier test, the pair staged a bullish bounce that led to a local high near 1.3632. The renewed interaction with this support zone may lay the groundwork for another potential bullish rebound. If momentum builds, the first resistance to watch lies around 1.3522. A clear breakout above this area could pave the way for a retest of recent highs.

This support zone gains further significance as it aligns closely with the 200-period moving average, currently sitting near 1.3430. A pullback into this zone could be viewed as a healthy technical correction, offering a potential launchpad for another leg higher.

Momentum indicators further support the bullish case. The Relative Strength Index (RSI) has dropped to 31, approaching oversold territory and signaling a potential influx of buyers. Moreover, the RSI has shown a bullish divergence compared to the price action observed on May 28. This divergence suggests weakening bearish momentum and may indicate that sellers are losing steam.

Trading Recommendations

Trading direction: Buy

Entry price: 1.3427

Target price: 1.3522

Stop loss: 1.3370

Validity: Jun 25, 2025 15:00:00

Risk Warnings and Disclaimers

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Manuel

Forex

Economic

Summary:

This area may act as a pivot point, and if sellers regain control, a pullback toward the next major support around 0.8103 could materialize.

SELL USDCHF

Close Time

CLOSED

0.81685

Entry Price

0.81050

0.82100

0.80292 -0.00163 -0.20%

41.5

Pips

Loss

0.81050

0.82100

Exit Price

0.81685

Entry Price

0.82100

Recent U.S. economic data revealed a mixed macroeconomic landscape. Retail sales in May declined by 0.9% month-over-month—the sharpest drop in four months—as consumer spending contracted amid growing uncertainty over new tariffs. However, the Retail Sales Control Group, which feeds directly into GDP calculations, defied expectations with a stronger-than-expected 0.4% increase, helping to cushion the overall picture. Meanwhile, U.S. industrial production fell by 0.2% in May, missing market expectations of a modest rise and exposing ongoing weaknesses in the manufacturing sector.

Adding to global market tension were comments from U.S. President Donald Trump, who called on Iran to agree to an "unconditional surrender" and dismantle its nuclear program or face escalating consequences. Praising recent Israeli airstrikes as "excellent" and "highly successful," Trump warned that future operations could be "even more brutal," urging Tehran to "make a deal now" or face total defeat. Speaking earlier aboard Air Force One after the G7 summit, the president made clear he was not seeking a ceasefire, but rather a “real end” to Iran’s nuclear ambitions, adding: “They should’ve taken the deal... I’m not in the mood to negotiate.”

On the inflation front, U.S. Producer Price Index (PPI) data for May pointed to continued disinflationary pressures. Headline PPI rose 2.6% year-over-year, in line with forecasts and slightly above April’s 2.5% print. However, core PPI—which excludes the more volatile food and energy components—edged down to 3.0% from 3.2%, reinforcing the view that underlying inflation is slowly retreating.

Meanwhile, data out of Switzerland continued to highlight subdued inflation dynamics. Producer and import prices fell by 0.7% year-over-year in May—deeper than April’s 0.5% decline—underscoring persistent disinflationary forces. On a monthly basis, prices fell 0.5%, surprising markets by reversing the previous month’s 0.1% uptick. This added further weight to expectations that the Swiss National Bank (SNB) may opt for further policy easing in its upcoming meeting.

Reinforcing the dovish narrative, Switzerland’s KOF Economic Institute revised down its growth forecast for 2026, citing unpredictability in U.S. trade policy as a key headwind. The think tank now projects adjusted GDP growth of 1.5% in 2026—a 0.4-point downgrade—while leaving its 2025 outlook unchanged at 1.4%. KOF also anticipates a gradual rise in unemployment to a neutral 3% by the end of next year and foresees a slowdown in job creation due to mounting political uncertainty. Softer energy prices and the resilient Swiss franc (CHF) also prompted KOF to cut its inflation forecasts to 0.2% for 2025 and 0.5% for 2026. A Bearish Turn May Be Brewing Near the 0.618 Fibonacci Level_1

A Bearish Turn May Be Brewing Near the 0.618 Fibonacci Level_1

Technical Analysis

USD/CHF has extended its rally, climbing from the June 12 low of 0.8055 to test the 200-period moving average around 0.8170. This move has brought the pair into the 0.618 Fibonacci retracement zone—a key level that often signals potential exhaustion in short-term bullish momentum. This area may act as a pivot point, and if sellers regain control, a pullback toward the next major support around 0.8103 could materialize.

From a momentum perspective, the RSI has climbed to 68, nearing overbought territory. This reading could encourage bearish participants to test the resilience of current resistance. Should the 0.8170 level hold, we may see a downward reaction from this area. A break below the 100-period SMA, now located around 0.8129, could trigger a sharper bearish acceleration. However, if the bulls manage to decisively push above the current resistance, the rally could resume, extending the upside move from this critical zone.

Trading Recommendations

Trading direction: Sell

Entry price: 0.8170

Target price: 0.8105

Stop loss: 0.8210

Validity: Jun 26, 2025 15:00:00

Risk Warnings and Disclaimers

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Adam

Cryptocurrency

Forex

Summary:

On June 17, 2025, the GBP/JPY pair continued its strong uptrend, reaching a multi-week high. This increase was supported by the Bank of Japan's (BoJ) decision to keep interest rates on hold and expectations for the Bank of England's (BoE) monetary policy....

BUY GBPJPY

Close Time

CLOSED

195.700

Entry Price

196.000

195.400

207.080 -0.020 -0.01%

30.0

Pips

Loss

195.400

195.399

Exit Price

195.700

Entry Price

196.000

Overview

On June 17, 2025, GBP/JPY rose to 196.85, marking a multi-week high. The rally was largely driven by the BoJ's decision to keep interest rates at 0.5% and its plan to slow down its purchases of Japanese government bonds (JGBs) starting in fiscal 2026.

The decision reflects the BoJ's cautious stance on monetary policy amid global uncertainty and concerns about the impact of the US-Japan trade war. Meanwhile, GBP is also supported by expectations that the BoE will keep interest rates steady at its upcoming meeting, although there may be adjustments in the near future.

Market psychology

The current market sentiment is bullish for GBP/JPY. The RSI (14) on the chart is currently at 56, indicating that the market is not overbought and there is still room for growth. However, investors should note that any signs of weakness from the UK or Japanese economies could impact this trend.

Technical analysis

On the chart, GBP/JPY is currently trading above its 50-period moving average, indicating a short-term uptrend. The next resistance level is located at 197.23, the May high.

If the price breaks above this level, the next target could be 198.06. However, if the price falls below the support level of 195.00, a correction signal towards 193.74 could appear.

Trading Recommendations

Entry: 195.7

Take Profit: 196

Stop Loss: 195.4

Risk Warnings and Disclaimers

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Adam

Forex

Summary:

On June 17, 2025, the EUR/USD pair recorded a sharp decline, breaking the support level of 1.1550. This weakness was driven by expectations of the US Federal Reserve's monetary policy and the economic situation in the eurozone....

SELL EURUSD

Close Time

CLOSED

1.15000

Entry Price

1.14500

1.15500

1.16671 +0.00245 +0.21%

32.1

Pips

Profit

1.14500

1.14679

Exit Price

1.15000

Entry Price

1.15500

Overview

On June 17, 2025, EUR/USD fell to 1.1530, breaking the key support level of 1.1550. This weakness was mainly driven by expectations that the Fed would maintain a steady interest rate policy at its upcoming meeting, while the European Central Bank (ECB) kept interest rates low. This created a difference in interest rates between the USD and EUR, increasing the attractiveness of the US dollar.

Market psychology

The current market sentiment shows caution and concerns about the global economic outlook. The RSI (14) on the 15-minute chart is currently at 36.18, indicating that the market is not overbought and may continue its downtrend. This reflects investors’ indecision in determining the next direction of the pair.

Technical analysis

EUR/USD Drops Sharply Below 1.1550: Will the Downtrend Continue?_1

On the 15-minute chart, EUR/USD is currently trading below the resistance level of 1.1550, indicating a short-term downtrend. The next support level is located at 1.1500. If the price breaks this level, the next target could be 1.1450. The RSI (14) indicator currently at 36.18 does not indicate oversold or overbought conditions, but if the indicator drops further, it could be a sign of a deeper correction.