EUR/USD Eyes 1.1560 Breakout

EUR/USD remains constructive, with our preference still tilted toward further upside following the latest US data. That view is primarily rooted in our Fed assessment, although renewed escalation in the Gulf remains an important risk, as a fresh bout of safe-haven demand could lend support to the US dollar.

From a technical perspective, EUR/USD has broken above the upper boundary of its broader ascending channel, weakening the previous bearish case. Price is now retesting the breakout area while consolidating inside a short-term descending structure, putting the 1.1560 resistance level firmly in focus.

A decisive break above 1.1560 would be the next bullish confirmation we are looking for. That could open the way toward 1.1620, which remains our target for the coming weeks. Beyond there, we continue to see scope for 1.1700 in the autumn and 1.1800 by year-end.

On the downside, 1.1500 is the key level to watch. We expect buyers to re-emerge on another test of this area, potentially establishing a higher dominant trading range between 1.1500 and 1.1600.

The main limitation for the bullish setup is the lack of an obvious near-term catalyst. That could keep EUR/USD range-bound for longer and leave volatility testing recent lows.

Key levels

• Resistance: 1.1560, 1.1620, 1.1700
• Support: 1.1500
• Near-term bias: Bullish while 1.1500 holds
• Bullish trigger: Clean break and hold above 1.1560
• Medium-term target: 1.1620