The EUR/USD currency pair declined, trading at 1.1590 and down 0.25%, as the Euro was capped by the 200-day Simple Moving Average (SMA) at 1.1633 amid rising geopolitical tensions and escalating hostilities between the US and Iran. This environment prompted investors to seek safety in the US Dollar, strengthening the greenback against the Euro [1].
From a technical perspective, the EUR/USD retreated below the 200-day SMA and approached the 100-day SMA at 1.1569, which serves as the first support area. The Relative Strength Index (RSI) remained above 50, indicating a bullish bias, but was trending lower, suggesting that sellers are gaining strength [1].
If the bearish momentum continues and EUR/USD clears the 100-day SMA, the next support levels are the August 13 swing low at 1.1511, followed by the 50-day SMA at 1.1494, and then the psychological level at 1.1400. Conversely, for buyers to regain control, the pair must break above the 200-day SMA and target the 1.1700 psychological level, with a decisive breakout exposing the May 6 high at 1.1796 [1].
The article highlights that the Euro's value is influenced by factors such as ECB monetary policy, inflation data, and economic releases, but the current move is primarily driven by geopolitical developments and risk aversion favoring the US Dollar [1].
CONCLUSION
EUR/USD is under pressure as geopolitical tensions drive demand for the US Dollar, with the pair trading below key technical levels. The outlook remains bearish unless buyers can reclaim the 200-day SMA, while further downside could be seen if support levels are breached.