EUR/USD Breaks Above Rectangle as Ceasefire Hopes Support Bullish Momentum

EUR/USD has broken above the rectangle pattern. Today's expectation of a probable 45-day ceasefire of the war in Iran is adding more strength to bulls, as energy seems to be the driving factor for EUR/USD currently.

The price is broken above the 1.1550 area. On the upside, the next target is near 1.1628, with further resistance near 1.1675 (200-day SMA). On the downside, 1.1510 remains near-term support, which is also the lower line of the rectangle. A weekly close below this area would increase the chances of a deeper drop toward 1.1450 (March low) and possibly 1.1411.

EUR/USD 4 Hour Chart

For now, the near-term technical bias remains bullish, as price has already broken above resistance and the rectangle pattern on the 4-hour chart.

Bottom line:

EUR/USD is coiling below major resistance. A breakout above 1.1610 signals recovery. A break below 1.1355 signals further downside. Upcoming inflation data and geopolitical risks may drive the next move.

Risk: any comment from the US or Iran that can worsen the worst situation. If that pushes the euro below 1500 and closes below 1500 at the end of the day, the bullish scenario will be invalidated.