EURUSD in limbo: geopolitics and inflation are holding the euro back

The euro has been losing ground for the third consecutive session, driven by geopolitics. Quotes are consolidating around 1.1680. Find more details in our analysis for 24 April 2026.

EURUSD forecast: key takeaways

• The second round of Iran-US negotiations has effectively collapsed
• The US manufacturing PMI rose to 54.0
• The US services PMI was up, coming in at 51.3
• EURUSD forecast for 24 April 2026: 1.1625 and 1.1785

Fundamental analysis

The EURUSD forecast takes into account that the euro continues to correct after its April rise, holding above the key support zone but losing ground for the third consecutive session. On Friday morning, quotes are consolidating around the 1.1680 level.

The main driver of today’s volatility is the stalemate in the Strait of Hormuz, which has turned the currency market into a hostage to news headlines, pushing traditional macroeconomic factors into the background.

Key events of recent days:

• Trump stated that he has total control over the Strait of Hormuz: the US President announced that no vessel can enter or leave without approval from the US fleet, giving orders to fire on any mine-laying boats. The Iranian parliament called reopening the strait impossible while the US blockade remains in place
• The second round of negotiations has effectively collapsed: Vice President Vance suspended his trip to Pakistan, while Iranian media called further dialogue a waste of time. Trump simultaneously announced an indefinite extension of the ceasefire, creating a unique deadlock scenario
• Strong US data failed to help the dollar: the manufacturing PMI rose to 54.0, the highest level in 47 months, while the services PMI reached 51.3. Against this backdrop, the USD failed to build on its gains, indicating a technical correction rather than a fundamental reversal

The market has found itself trapped in its own dilemma: the dollar receives support as a safe-haven asset every time the geopolitical situation worsens, but loses ground on any hint of diplomatic progress. This keeps the EURUSD rate hostage to news headlines.

Fundamentally, the pair stands between two powerful but opposing forces. On the one hand, markets are pricing in an ECB rate hike due to inflation driven by high oil prices amid a Federal Reserve pause, which historically supports the euro. On the other hand, unlike the US economy, the European economy is suffering from the energy shock as a hydrocarbon importer, which is limiting risk appetite. The coming days and any news from the Strait of Hormuz will continue to influence the EURUSD rate.

Technical outlook

On the H4 chart, the EURUSD pair formed a Hammer reversal pattern near the lower Bollinger Band. At this stage, quotes may form an upward wave following the signal. Since they remain within an ascending channel, the 1.1780 resistance level may act as the upside target. A breakout above this level would open the way for the continued upward momentum.

At the same time, today’s EURUSD forecast also suggests another scenario. Quotes may continue the correction and test the 1.1625 support level. After a rebound, they may continue the uptrend, with the next upside target at 1.1900.

EURUSD overview

• Asset: EURUSD
• Timeframe: H4 (Intraday)
• Trend: bullish
• Key resistance levels: 1.1785 and 1.1870
• Key support levels: 1.1625 and 1.1535

EURUSD trading scenarios for today

Main scenario (Buy Stop)

Consolidation above 1.1785 would confirm an attempt to recover after the current correction. If the geopolitical backdrop stabilises, the pair could move towards 1.1900.

• Take Profit: 1.1900
• Stop Loss: 1.1745

Alternative scenario (Sell Stop)

A breakout and consolidation below the 1.1625 support level would intensify pressure amid growing demand for the dollar as a safe-haven asset. The decline may continue to the next support level at 1.1535.

• Take Profit: 1.1535
• Stop Loss: 1.1655

Risk factors

Risks to the upside include escalating tensions in the Middle East and persistent high inflation risks, which support the dollar. The Fed’s hawkish rhetoric and a revision of rate expectations could be an additional factor, which would limit the upside potential for the EURUSD pair.

Summary

Breakdowns in negotiations between Iran and the US are affecting EURUSD quotes, and the pair continues to correct. At the same time, EURUSD technical analysis suggests growth towards the 1.1785 level after the correction is complete.

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