2025 EUR/USD Technical Outlook Preview
This is an excerpt from our full 2025 EUR/USD Outlook report, one of nine detailed reports about what to expect in the coming year.
Euro Price Chart – EUR/USD Monthly
Chart Prepared by Michael Boutros, Sr. Technical Strategist; EUR/USD on TradingView
Euro continues to trade within the confines of an ascending pitchfork formation extending off the 2022 low with the April advance faltering just ahead of resistance at 1.1275 into the close of Q2. The subsequent reversal was poised to close a third-consecutive monthly loss as of late December with EUR/USD attempting to mark a close below support around the 2015 low at 1.0463- looking for clear inflection off this mark into the yearly cross.
Note that monthly momentum readings have reached the lowest levels in over a year and an RSI reading sub-forty into the close would suggest a larger shift in the momentum profile favoring the bears. Critical support rests with Parity while key resistance (bearish invalidation) for the broader downtrend is eyed with the 2020 low-month close (LMC) / the objective 2024 yearly open at 1.1032/38.
Euro Price Chart – EUR/USD Weekly
Chart Prepared by Michael Boutros, Sr. Technical Strategist; EUR/USD on TradingView
A closer look at the weekly chart shows the November rebound off the lower parallel of a descending pitchfork we have been tracking off the September highs. Initial weekly support rests with the 2016 swing low at 1.0352. Ultimately, a break below the lower parallel would threaten the next major leg of the decline towards the 61.8% retracement of the 2022 advance at 1.02 and parity- both levels of interest for possible downside exhaustion / price inflection IF reached.
Weekly resistance stands with the November high-week close (HWC) / February low-week close (LWC) at 1.0719/77- a breach / close above this threshold would be needed to suggest a more significant low is in place / a larger trend reversal is underway. Subsequent resistance eyed at the March HWC a 1.0939 and the December HWC / 2024 yearly open at 1.1038- both levels of interest for possible topside exhaustion / price inflection IF reached.
Bottom Line: Euro remains vulnerable to further losses heading into the 2025 open and the focus is on an exhaustion low in the first half of the year. From a trading standpoint, the threat remains weighted to the downside while below 1.0777 – look for a larger reaction on stretch towards the lower parallel for guidance with a closer below 1.02 needed to fuel the next major leg of the decline. The onus is on the bulls to try to secure a low ahead of parity IF the 2022 advance is to remain viable in the coming year. The EUR/USD battle lines are drawn heading into 2025.
--- Written by Michael Boutros, Sr Technical Strategist with FOREX.com
Follow Michael on X @MBForex
The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex, commodity futures, or digital assets, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to FOREX.com or GAIN Capital refer to StoneX Group Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.
Please note that foreign exchange and other leveraged trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved, seeking independent advice if necessary.
Contracts for Difference (CFDs) are not available to US residents.
FOREX.com is a trading name of GAIN Capital - FOREX.com Canada Limited, 30 Independence Blvd, Suite 300 (3rd floor), Warren, NJ 07059, USA is a member of the Canadian Investment Regulatory Organization and Member of the Canadian Investor Protection Fund. GAIN Capital – FOREX.com Canada Limited is a wholly-owned subsidiary of Stonex Group Inc.
Complaints are taken very seriously at FOREX.com. You can view our complaints procedure here.
© FOREX.COM 2024