FX.co ★ EUR/USD

The EUR/USD pair is currently suspended at a critical technical juncture, trading at 1.1655. Following a significant ascent to the 1.1805 peak in late December 2025, I am observing a steady erosion of Euro gains as the U.S. Dollar reclaims its dominance. This correction is not merely a technical pullback; it reflects a shift in market psychology where the "Goldilocks" scenario of 2025 is meeting the harsh reality of 2026 economic divergence. While Eurozone inflation is effectively anchored, the U.S. labor markets resilience—even amidst data distortions—is forcing a repricing of the Federal Reserves interest rate trajectory. I see the pair currently trapped in a high-tension consolidation phase, awaiting a definitive catalyst to break the current deadlock. High Impact Fundamental Economic News The financial calendar for today, January 9, 2026, and the upcoming week contains the most significant volatility triggers for the pair: U.S. Non-Farm Payrolls (NFP): Scheduled for release today at 8:30 AM ET. The market is bracing for a print of 60,000 to 70,000 jobs. I anticipate that any number exceeding 95,000 will cause a rapid Dollar surge, whereas a figure below 40,000 could trigger a sharp relief rally for the Euro toward 1.1750. U.S. Average Hourly Earnings: I am monitoring this closely as a secondary indicator. If wage growth exceeds 0.3% month-on-month, it will signal persistent inflationary pressure, providing the Dollar with a "yield-advantage" bid. Eurozone Sentiment and Production Data: Early next week, German Industrial Production will be released. With the Eurozone struggling to maintain a 1% growth rate, any disappointment here will likely cement the 1.1700 level as a long-term ceiling. Critical Support and Resistance Zones At the 1.1655 level, the pair is operating within a tightening corridor. I have identified the following primary boundaries: Major Resistance 1 (1.1710 - 1.1725): This zone houses the 20-day Exponential Moving Average. Until the price can reclaim a daily close above 1.1725, I view every rally as a selling opportunity. Psychological Resistance (1.1800): This is the gateway to the 1.2000 handle. It remains a distant target unless todays U.S. data proves exceptionally weak. Immediate Support (1.1640): This is the live floor. It aligns with the 50-day Simple Moving Average. If I see a sustained break below 1.1640 today, the pair is likely headed for a deep correction. Major Support 2 (1.1560): This is the 200-day Moving Average. It represents the "fair value" of the pair over the last year and acts as a massive magnet for price action if volatility spikes. Moving Average and MACD Trade Plan My technical analysis currently favors a "Sell-on-Strength" approach based on the alignment of trend-following indicators. Moving Average Analysis I note that the price has recently slipped below the 20-day EMA (1.1712). In technical terms, the price is "living" below its short-term mean, which confirms bearish momentum. However, the 50-day SMA at 1.1640 is currently providing a dynamic floor. I am looking for a "crossover" event; if the 20-day EMA begins to point sharply downward toward the 50-day SMA, it will signal a multi-week bearish cycle. MACD Indicator Signals The MACD line has recently crossed below the signal line, and the histogram is expanding in the negative zone. This suggests that selling pressure is accelerating. I recommend watching the histogram: if it begins to fade back toward the zero line while the price stays above 1.1640, it indicates a "Bullish Divergence" might be forming. For now, the signal remains bearish, and I would avoid going long until the MACD line stabilizes. Fibonacci Precision for Entry and Exit By applying Fibonacci retracement levels from the 1.1500 swing low to the 1.1805 swing high, I have tuned the chart to identify the exact coordinates for trade execution: Strategic Entry (Sell): I am looking for a retracement back to the 23.6% level at 1.1733. This is an ideal "Sell Limit" zone for those looking to follow the current bearish momentum. Strategic Entry (Buy): For a contra-trend trade, the 61.8% Golden Ratio at 1.1616 offers the best risk-reward ratio. This is a high-confluence zone where I expect heavy institutional buying to occur. Take Profit 1 (Shorts): I would exit half of a short position at 1.1652 (the 50% retracement), which is nearly where the price is currently sitting. Take Profit 2 (Shorts): The ultimate target for this leg down is 1.1570, just above the 200-day SMA. Stop Loss Placement: For any sell orders near 1.1730, I would place a protective stop at 1.1775 to account for NFP-induced "wicks."

Unique Market Perspective I believe the current price of 1.1655 is a "coiling" phase. Historically, when the EUR/USD sits at the 50% Fibonacci level ahead of a major employment report, the ensuing move is usually 80 to 120 pips in magnitude. My unique observation is that the Euro is currently showing "hidden weakness" against the Pound and Yen as well, which suggests that the move down at 8:30 AM ET might be more aggressive than the market currently anticipates. I advise you to wait for the initial 5-minute candle after the NFP release to close before committing to a direction.