EURUSD is slowing its growth near the key resistance level

The EURUSD pair is correcting as investors continue to assess the outlook for Federal Reserve policy amid the latest US macroeconomic data. The rate currently stands at 1.1426. Find out more in our analysis for 7 July 2026.

EURUSD forecast: key takeaways

• Investors have reduced expectations for further Fed monetary policy tightening
• The US services PMI fell to 54.0 points in June from 54.5 points in May
• The US service sector continues to show steady expansion despite a moderate slowdown in growth
• EURUSD forecast for 7 July 2026: 1.1255

Fundamental analysis

The EURUSD rate is undergoing a correction after rising for the last three consecutive trading sessions, but buyers encountered strong resistance near the 1.1475 level, which is holding back further upward momentum.

The US dollar remains under pressure after last week’s labour market report indicated a noticeable slowdown in employment growth in June. A downward revision of employment data for the previous two months also put additional pressure on the US currency. As a result, investors reduced expectations of further Federal Reserve monetary policy tightening.

At the same time, the US services PMI fell to 54.0 points in June from 54.5 points a month earlier, fully in line with market forecasts. Despite the slight slowdown, the indicator continues to point to steady expansion in the service sector. At the same time, the employment index rose to 51.2 from 47.9, showing the strongest growth since 2024 and returning above the 50.0 mark for the first time since February, indicating renewed employment growth in the sector.

Despite positive signals from the service sector, markets are currently pricing in the likelihood of a Federal Reserve rate hike in September at around 50%.

Technical outlook

The EURUSD rate is correcting within a bullish channel. Sellers have once again pushed quotes back below the EMA-65, indicating stronger bearish pressure and continued downward momentum. Today’s EURUSD forecast suggests further decline, with the nearest target at 1.1255.

The technical picture remains bearish. The Stochastic Oscillator reached the descending resistance line and signalled renewed downward movement. A breakout below the lower boundary of the corrective channel, followed by consolidation below 1.1400, would further confirm the bearish scenario.

An alternative scenario suggests renewed growth if the price breaks above the upper boundary of the descending channel and consolidates above 1.1490. In this case, the downside scenario will be cancelled, while the probability of a deeper upward correction will increase significantly. The next target for buyers will be 1.1565.

EURUSD overview

• Asset: EURUSD
• Timeframe: H4 (Intraday)
• Trend: upward
• Key resistance levels: 1.1475 and 1.1575
• Key support levels: 1.1355 and 1.1305

EURUSD trading scenarios for today

Main scenario (Sell Stop)

A breakout below the lower boundary of the bullish corrective channel, with the price consolidating below 1.1400, would create conditions for opening short positions in the pair and indicate the completion of the upward correction.

• Take Profit: 1.1255
• Stop Loss: 1.1435

Alternative scenario (Buy Stop)

A breakout above the key resistance level at 1.1475 and the upper boundary of the descending channel would indicate continued growth and stronger pressure from EURUSD buyers.

• Take Profit: 1.1565
• Stop Loss: 1.1455

Risk factors

The main risk to the EURUSD downside scenario remains persistent pressure on the US dollar amid a possible further reduction in expectations of a Federal Reserve rate hike. A breakout and consolidation above the 1.1490 level would cancel the bearish scenario, opening the way for a deeper upward correction with a target at 1.1565.

Summary

Technical analysis of EURUSD suggests potential for a continued decline, as pressure on the US dollar has weakened and technical indicators point to stronger seller positions. A breakout below the 1.1400 level would confirm the bearish scenario with a target at 1.1255.

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