EUR/USD remains stable above 1.1700, currently trading near the 1.1760–1.1780 range, following a two-month peak at approximately 1.1768. Each advance toward the 1.1770–1.1800 range is encountering profit-taking instead of strong selling pressure, indicating a balanced two-way market rather than a trend reversal. The pair is currently experiencing a slight upward trend in the short term, remaining well above recent consolidation levels, with any declines towards 1.1730–1.1710 being met with buying interest rather than selling pressure. On the 4-hour view, EUR/USD is positioned above the 20-period moving average around 1.1735, serving as the initial dynamic support level. A significant intraday support level is established near 1.1685, a zone where price action has previously consolidated and where the 50-period moving average converges. On the daily time frame, the rally has driven RSI into the 70 zone, indicating overbought conditions following several robust sessions, yet there is no evident bearish divergence present. Support levels are positioned at 1.1710, followed by 1.1660, with a significant structural base around 1.1580. On the topside, resistance is focused around 1.1770–1.1790, with additional levels at 1.1830 and 1.1900. The structure remains traditional: overbought momentum within a continuing bullish trend, where a pullback to the 1.1710–1.1685 range would represent a typical reset rather than a trend reversal, provided that the 1.1660–1.1580 zone holds firm.
The policy environment for the euro is straightforward and favorable for EUR/USD. The consensus among market participants is that the ECB will maintain its current interest rates until 2026, indicating no forthcoming easing cycle and no plans for additional tightening measures at this time. The “steady but not aggressive” approach mitigates volatility for the euro and averts a dovish surprise that could significantly impact EUR negatively. Eurozone PMIs are anticipated to indicate services activity at approximately 53.3 and manufacturing close to 49.9, a combination that suggests slight expansion instead of recession. This profile lacks the strength to independently drive a significant euro re-rating; however, it sufficiently supports a stable ECB as the Fed is already implementing cuts. The significant momentum in EUR/USD is primarily driven by the dollar’s performance. The Federal Reserve has implemented three rate reductions in 2025, adjusting the funds range to 3.50%–3.75%. Powell has recognized evident cooling in the labor market and indicated that policy is currently in a “wait and assess” phase. Initial jobless claims have reached their highest level in almost five years, private payrolls have unexpectedly declined, and services activity remains only modestly positive. Inflation is showing signs of easing rather than accelerating, with expectations for CPI now at approximately 3.1% year-on-year compared to the previous 3.0%. The interplay of reduced rates, a softer job market, and stable inflation has driven the Dollar Index down to approximately 98.25, placing the USD in a vulnerable position. The current environment facilitates EUR/USD maintaining its position above 1.1700 and aiming for the 1.1760–1.1800 range.
The postponed US labor report for October and November serves as the immediate catalyst for the next movement in EUR/USD. The consensus anticipates approximately 40k–50k new jobs for November, alongside an unemployment rate near 4.4%. Market participants are particularly focused on wage growth following a 3.8% year-on-year figure reported in September. A softer-than-expected NFP number or an unemployment rate exceeding 4.4% would strengthen expectations for additional Fed cuts in 2026 and likely drive EUR/USD past 1.1800, creating potential for movement towards 1.1830 and possibly the 1.1900 region. An unexpected increase in jobs or wages would lead to a different outcome: expectations for rate cuts would diminish, yields would rise, the USD would strengthen, and the pair might retreat toward 1.1710–1.1685, with the possibility of a brief dip below 1.17 if market positioning is heavily concentrated. The Eurozone PMI releases serve as the primary European data input and function as a secondary influence on EUR/USD in relation to US labor statistics. The Services PMI, anticipated around 53.3, indicates continued expansion, whereas the manufacturing figure close to 49.9 suggests the economy is teetering on the brink of growth. Stronger-than-expected PMIs would reinforce the notion that additional ECB cuts are unnecessary and would provide support for EUR on dips, assisting EUR/USD in maintaining levels above 1.17. Weaker PMIs may not prompt immediate cuts from the ECB, yet they would eliminate a key bullish argument for the euro. In a weaker scenario, the pair becomes increasingly dependent on Fed dovishness and dollar softness, with any overbought technical condition having additional room to correct toward 1.1660–1.1580 before buyers re-enter the market.
The positioning in EUR/USD reflects a long bias following the rapid rise from the low-1.16 range to 1.1768. Medium-term bulls who built positions around 1.15–1.16 are comfortably in profit and can sit through volatility, but late buyers above 1.1750 are vulnerable if data breaks against them. The overbought daily RSI near 70 highlights this crowding risk. A decisive break below 1.1710, particularly a daily close beneath 1.1685, would indicate a more significant decline toward 1.1660 and possibly 1.1580 as overextended long positions are liquidated. Conversely, if NFP and PMIs align to support a weaker USD and a stable EUR, shorts positioned above 1.1760–1.1770 may be quickly squeezed through 1.1800 into the 1.1830–1.1900 range. Analyzing the current levels, the primary downside zones in EUR/USD are identified at 1.1710–1.1735 for initial demand, with 1.1685 representing a deeper short-term support. The level at 1.1660 marks the beginning of significant corrective territory, while 1.1580 serves as the structural line that delineates the ongoing bullish phase. On the upside, 1.1770–1.1790 is the first ceiling, followed by 1.1830 and then 1.1900 as an extension target if both Eurozone and US data favour the euro. In terms of risk and reward, the more prudent approach is to build positions on managed pullbacks towards 1.1685–1.1640, targeting an upside of 1.1850–1.1900, while maintaining a protective threshold below 1.1580, rather than pursuing new long positions directly at the 1.18 resistance where the RSI is already elevated. In summary, with the Federal Reserve having reduced rates to 3.50%–3.75%, US job growth anticipated in the 40k–50k range alongside a 4.4% unemployment rate, Eurozone PMIs stabilizing at approximately 53.3 for services and 49.9 for manufacturing, the Dollar Index remaining around 98.25, and EUR/USD approaching a two-month peak near 1.1768, the overall strategic landscape is evident. The medium-term outlook for EUR/USD remains positive as long as the pair stays above approximately 1.1660–1.1580, indicating a likely progression towards 1.1830 and possibly 1.1900 as the current overbought conditions subside. Tactically, this remains a buy-the-dip, not chase-the-break setup: corrections into the 1.17 handle are more attractive entries than new longs into resistance at 1.18, and a daily close below 1.1580 would be the point where the view shifts from Buy to, at best, Hold.