Renewed optimism over a potential US-Iran peace deal weakens the USD, lifting the EUR/USD pair above key Fibonacci levels.
The EUR/USD pair opened the week with a bullish gap, trading near 1.1650 as optimism over a US-Iran peace deal reduced demand for the safe-haven USD. Spot prices climbed during the Asian session, recovering from last week’s low of 1.1575, the lowest since April 7.
Technically, the pair holds above the 23.6% Fibonacci retracement of its April-May decline, with a Relative Strength Index (RSI) at 58 and a slightly positive MACD signaling improving momentum. However, hawkish Federal Reserve expectations may limit USD losses, capping further gains. Resistance is seen near the 38.2% Fibonacci level at 1.1675-1.1680, followed by 1.1710.
Downside support lies at the 23.6% retracement level of 1.1638, with deeper floors at structural Fibonacci levels if selling pressure resumes.