EURUSD between diplomacy and crisis, the market awaits a signal

Geopolitics is once again on the euro’s side, as a possible easing of the Middle East conflict is reducing the appeal of the USD. The EURUSD rate currently stands at 1.1650. Find more details in our analysis for 29 May 2026.

EURUSD forecast: key takeaways

• US data put additional pressure on the dollar
• The ECB is preparing to raise interest rates
• The EURUSD rate remains dependent on comments from the White House
• EURUSD forecast for 29 May 2026: 1.1700

Fundamental analysis

The EURUSD forecast takes into account that the pair is forming a correction following a rise, while the euro is not giving up hope of a recovery.

The market interprets a possible 60-day ceasefire agreement between the US and Iran as a positive signal, which weakens the USD and supports the euro. However, the lack of final approval from the US and Iran is preventing the pair from making a more decisive upward move.

US data added to pressure on the dollar. Q1 GDP fell to 1.6%, while the market had expected growth to 2.0%. The core PCE price index confirmed expectations and rose to 3.3%. Initial jobless claims rose to 215 thousand, up from the previous reading of 210 thousand.

The market interpreted this data as support for the Federal Reserve, which may reconsider its stance on keeping the interest rate unchanged and decide to change it in the near term.

The ECB, by contrast, is gearing up for a hike, with the market estimating the likelihood of an interest rate increase at the June meeting at 80–85%.

Both regulators are leaning towards tighter monetary policy, but the euro’s advantage is that the ECB is catching up from lower levels. If the ECB rate reaches 2.6% by the end of the year, as the market expects, the gap with the Fed will begin to narrow, supporting the euro.

Weak US macroeconomic data created the background for a weaker dollar, but without Trump’s final approval of the Iranian memorandum, the pair remains dependent on geopolitics.

Technical outlook

On the H4 chart, the EURUSD pair formed a Harami reversal pattern near the lower Bollinger Band. At this stage, quotes may continue the upward wave as the signal plays out. Since they remain within an ascending channel, the upside target could be the 1.1700 resistance level. An upward breakout would open the way for continued upward momentum.

At the same time, today’s EURUSD forecast also suggests another market scenario. Quotes may form a corrective wave and test the 1.1620 support level. After rebounding, they may continue the uptrend.

EURUSD overview

• Asset: EURUSD
• Timeframe: H4 (Intraday)
• Trend: downward
• Key resistance levels: 1.1700 and 1.1785
• Key support levels: 1.1620 and 1.1505

EURUSD trading scenarios for today

Main scenario (Sell Stop)

A breakout below the 1.1620 support level would indicate that conditions are forming for opening short positions.

• Take Profit: 1.1505
• Stop Loss: 1.1645

Alternative scenario (Buy Stop)

A breakout above the resistance level and consolidation above 1.1700 would increase buying pressure and indicate a weakening USD. In this case, the EURUSD pair could rise to 1.1785 and above.

• Take Profit: 1.1785
• Stop Loss: 1.1685

Risk factors

Risks to the EURUSD decline remain subject to geopolitical developments in the Middle East as easing tensions between the US and Iran could send the USD tumbling and support the euro.

Summary

The euro is once again attempting to regain lost ground amid geopolitical tensions. EURUSD technical analysis suggests growth towards 1.1700 following a correction.

Open Account

Editors’ picks

EURUSD 2026-2027 forecast: key market trends and future predictions

This article provides the EURUSD forecast for 2026 and 2027 and highlights the main factors determining the direction of the pair’s movements. We will apply technical analysis, take into account the opinions of leading experts, large banks, and financial institutions, and study AI-based forecasts. This comprehensive insight into EURUSD predictions should help investors and traders make informed decisions.

Gold (XAUUSD) forecast 2026 and beyond: expert insights, price predictions, and analysis

Dive deep into the Gold (XAUUSD) price outlook for 2026 and beyond, combining technical analysis, expert forecasts, and key macroeconomic factors. It explains the drivers behind gold’s recent surge, explores potential scenarios including a move toward 4,500 to 5,000 USD per ounce, and highlights why the metal remains a strong hedge during global uncertainty.