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Currency Talk – EUR/NZD, EUR/CAD, AUD/USD

The Overbalance analysis aims to identify three financial instruments, analyzed primarily on the daily/four-hour (D1/H4) timeframe. The analysis uses only the Overbalance methodology, which helps determine where a trend may continue or where it may reverse.
Today’s analysis covers three instruments, evaluated solely in terms of 1:1 correction structures.

EURNZD
Last week, the EURNZD broke through key resistance at 1.9855, which corresponded to the upper boundary of the 1:1 geometric pattern. According to the Overbalance methodology, this breakout suggests potential for a move toward last November’s highs, around 2.0680. An additional argument in favor of the bullish scenario is the earlier double bounce off support at 1.9540. In the event of a correction, the 1.9855 level should act as short-term support.

EURNZD – H4 timeframe. Source: xStation

EURCAD
The EURCAD pair is attempting to resume its upward trend. The price has broken above the upper boundary of the 1:1 bearish pattern at the 1.5945 level and has also broken above the polarity of the previous bullish pattern, which falls exactly at the same point. According to the Overbalance methodology, as long as the price remains above the 1.5945 level, the bullish scenario remains in effect.

EURCAD – H4 timeframe. Source: xStation

AUDUSD
The AUDUSD price has broken below the key support level at 0.6905, which corresponded to the lower boundary of a broad 1:1 pattern. A break below this level could support a scenario involving a deeper correction or even a trend reversal. Currently, the 0.6905 level acts as key resistance. To signal a return to an uptrend, the price would need to additionally break above the 0.6984 level, where the upper boundary of the local 1:1 downtrend pattern is located.

AUDUSD – H4 chart. Source: xStation

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Euro Heads for Over 2% Monthly Loss as Middle East Risks Weigh

The euro held steady at $1.15 by the end of March, poised for a monthly decline of over 2% against the US dollar. Traders offloaded riskier assets as concerns mounted over the economic fallout from the escalating Middle East conflict, with reports suggesting thousands of US troops were preparing for a potential ground operation, despite Washington’s insistence that diplomatic talks with Iran were progressing. Investors also turned their attention to a wave of key economic data due this week, including March inflation flash estimates from Europe’s major economies. Market sentiment has shifted sharply on ECB policy, with traders now pricing in at least two interest rate hikes this year and a growing possibility of a third, abandoning earlier expectations of a 40% chance of a rate cut in 2026.

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EUR/USD edges higher as Dollar takes breather after weekly surge

  • EUR/USD rebounds as the US Dollar eases from intraday highs.
  • Weak US consumer sentiment contrasts with rising inflation expectations.
  • Markets reassess interest rate outlook amid elevated Oil prices and geopolitical risks.

EUR/USD edges higher on Friday after early weakness, as the US Dollar (USD) pulls back from intraday highs, offering some support to the Euro (EUR). At the time of writing, the pair trades around 1.1545, recovering from a daily low at 1.1501.

The pullback in the US Dollar appears largely technical, as buyers take a breather following a strong rally earlier this week that pushed the US Dollar Index (DXY) above the key 100.00 psychological level.

The index, which tracks the Greenback against a basket of six major currencies, is currently hovering near 99.85, reflecting a modest pause in upside momentum. However, it remains on track for weekly gains, staying broadly supported amid ongoing Middle East tensions.

On the data front, the University of Michigan figures came in weaker than expected. The Consumer Sentiment Index fell to 53.3 in March, down from the preliminary estimate of 55.5. The Consumer Expectations Index also declined to 51.7 from 54.1.

At the same time, inflation expectations moved higher. The 1-year outlook rose to 3.8% from 3.4%, while the 5-year expectation stayed at 3.2%.

Richmond Fed President Thomas Barkin said higher gasoline prices are weighing on consumer sentiment and could crowd out other spending. He added that even before the recent oil shock, progress on inflation was at risk of stalling. Barkin also noted that while the unemployment rate remains low, the labor market still feels fragile, highlighting risks to both sides of the Fed’s dual mandate.

On the geopolitical front, the lack of fresh headlines has kept trading conditions relatively calmer on Friday compared to earlier this week, when conflicting signals around potential US-Iran negotiations drove volatility. US President Donald Trump announced a delay in planned military strikes targeting Iran’s energy infrastructure. The deadline, initially set to expire on Friday, has now been extended by 10 days. 

However, with no clear signs of a resolution yet and the Strait of Hormuz largely closed, Oil prices remain elevated, continuing to fuel inflation concerns. This is prompting markets to reprice the interest rate outlook, with traders now pricing in 2-3 European Central Bank (ECB) hikes by year-end, while expectations for Federal Reserve (Fed) rate cuts are being trimmed, with some even seeing the possibility of a hike later this year.

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EUR/GBP keeps hovering around 0.8650, unfazed by UK consumption data

  • The Euro remains practically flat around 0.8650, following UK Retail Sales data.
  • Markets pay little attention to February’s UK consumption figures, as they predate Iran’s war.
  • Inflation in Spain accelerated in March to its highest level since 2024.

The Euro (EUR) keeps trading sideways against the British Pound (GBP) on Friday, oscillating within a tight range around the 0.8650 level for the fourth consecutive day, on track for a 0.25% weekly decline. The stronger-than-expected UK  Retail Sales figures released earlier on the day have failed to provide any significant support to the Sterling.

Data released by National Statistics earlier on Friday revealed that retail consumption fell for the first time in the last three months in February, by 0.4%, following a 2% increase in January. The market consensus had anticipated a sharper, 0.8% decline.

Excluding fuel, sales of all other items have shown a similar pattern, falling 0.4% on the month after a 2.2% gain in January, yet remaining above the -0.8% market consensus. Year on year, Retail Sales growth eased to 2.5%, from an upwardly revised 4.8% growth in the previous month, while the Core Retail Sales slowed down to 3.4% from 5.9% in January.

These figures have had a limited impact on the market as they predate the start of the war in Iran. Data from March, which will show the impact of a sharp decline in consumer confidence and a sharp uptick in prices due to the surge in Oil prices, is likely to have more relevance.

The Euro, on the other hand, remains on its back foot, also weighed by the pressure of higher Oil prices in the Eurozone economy. Spain’s Consumer Price Index (CPI) accelerated to 3.3% year-on-year in March, its highest level in 14 months, adding pressure on the European Central Bank (ECB) to hike interest rates in April.

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EUR/USD Price Forecast: Resumes downside after failing to hold above 200-day EMA

  • EUR/USD trades marginally lower around 1.1520 as the US Dollar remains firm amid Middle East conflicts.
  • Peace mediators dismiss Trump’s claim that the 10-day halt to attacks on Iranian energy plants was ordered as per Tehran’s request.
  • ECB’s Lagarde warns of persistent energy supply risks due to significant damage to Gulf energy infrastructure.

The EUR/USD pair trades subduedly around 1.1520 during the European trading session on Friday. The major currency pair faces slight selling pressure as the US Dollar (USD) trades firmly with hopes of a de-escalation in the Middle East war easing, which involves the United States (US), Israel, and Iran.

During the press time, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades 0.1% higher to near 100.00.

Investors turn doubtful over Mideast optimism amid the conflicting statements from peace mediators on US President Donald Trump’s claim that he ordered a pause on planned military strikes on Iran’s power plans as per Tehran’s request.

According to the Wall Street Journal (WSJ), peace talks mediators dismissed claims that Iran had requested a 10-day pause on strikes on its energy plants.

On the Euro (EUR) front, the major currency is expected to remain under pressure amid fears of persistent energy supply disruption in the wake of damage to Gulf energy infrastructure amid the war.

European Central Bank (ECB) President Christine Lagarde said in an interview with the Economist that the negative energy shock to the world economy from the Mideast war would be larger than current projections, as too much energy infrastructure has been damaged.

EUR/USD technical analysis

EUR/USD trades lower at around 1.1520 as of writing. The pair holds just above the 200-day EMA near 1.1540 while extending a sequence of lower highs below the 20-day EMA around 1.1590, keeping the near-term bias modestly bearish within a broader sideways context.

The 14-day Relative Strength Index (RSI) struggles to hold its recovery move into the 40.00-60.00 zone, signifying heavy selling pressure at higher levels.

Immediate resistance emerges at the 20-day EMA around 1.1590, with a daily close above this barrier needed to ease bearish pressure and open a move toward 1.1690. A stronger recovery would then target the 1.1810/1.1850 area, where prior highs cluster and the recent breakdown began. On the downside, initial support is located at 1.1500, guarding the late pullback low at 1.1415. A decisive break below 1.1415 would confirm a continuation of the downswing and expose the next support zone closer to 1.1350, where longer-term buyers would be expected to re-emerge.

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EUR/USD inches up after Trump’s Hormuz deadline extension; remains below mid-1.1500s

  • EUR/USD attracts some buyers during the Asian session amid a modest USD downtick.
  • Trump extends the deadline to reopen the Strait of Hormuz, undermining the buck.
  • Persistent geopolitical uncertainty and hawkish Fed bets could limit the USD downside.

The EUR/USD pair edges higher during the Asian session on Friday, though it lacks bullish conviction and risks attracting fresh sellers amid a bullish US Dollar (USD). Nevertheless, spot prices, for now, seem to have snapped a three-day losing streak and currently trade around the 1.1535-1.1540 area, up nearly 0.10% for the day.

US President Donald Trump delayed a threatened strike on Iran’s energy infrastructure and extended his deadline for Tehran to reopen the Strait of Hormuz until April 6. This helps ease concerns about a further escalation of tensions in the Middle East and dents the USD’s safe-haven demand, which turns out to be a key factor offering some support to the EUR/USD pair.

Meanwhile, Iran has threatened to retaliate against regional infrastructure, including desalination facilities, if Trump follows through with his threat. Moreover, the deployment of additional US troops has been fueling speculation of a potential ground operation. This keeps geopolitical risks in play and should underpin the USD’s status as the global reserve currency.

Apart from this, hawkish US Federal Reserve (Fed) expectations might continue to act as a tailwind for the buck and cap the upside for the EUR/USD pair. Investors remain worried that the war-driven surge in energy prices would revive inflationary pressures and now seem to have fully priced out the possibility of any further interest rate cuts by the Fed this year.

Moreover, traders are rapidly increasing bets for a hike by the end of this year. The outlook remains supportive of elevated US Treasury bond yields and validates the USD bullish bias. This, in turn, warrants some caution for the EUR/USD bulls and makes it prudent to wait for some follow-through buying before positioning for any further intraday appreciating move.

US Dollar Price Today

The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Swiss Franc.

USDEURGBPJPYCADAUDNZDCHF
USD-0.10%-0.08%-0.14%-0.09%-0.07%-0.10%-0.04%
EUR0.10%0.02%-0.06%0.00%0.02%-0.00%0.06%
GBP0.08%-0.02%-0.09%-0.02%0.01%-0.03%0.04%
JPY0.14%0.06%0.09%0.07%0.06%0.04%0.12%
CAD0.09%-0.01%0.02%-0.07%0.00%-0.00%0.05%
AUD0.07%-0.02%-0.01%-0.06%-0.00%-0.02%0.04%
NZD0.10%0.00%0.03%-0.04%0.00%0.02%0.06%
CHF0.04%-0.06%-0.04%-0.12%-0.05%-0.04%-0.06%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

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Trade of The Day – EUR/USD

Facts:

  • The EUR/USD exchange rate failed to break above the 200-day EMA
  • The price remains below the 50-, 100-, and 200-day exponential moving averages (EMA)

Recommendation: 

Trade: Short position on the EUR/USD pair at market price

Take Profit 1: 1,14850

Take Profit 2: 1,14240

Stop: 1.16415
 

Opinion:

The EUR/USD pair failed to break above the 200-day exponential moving average (EMA), which is a key technical signal confirming the euro’s continued weakness against the dollar. The price remains below the 50-, 100-, and 200-day EMAs, creating a classic bearish pattern—each of these moving averages currently acts as dynamic resistance, pushing the price back down on subsequent attempts to rebound. A stop-loss set at 1.16415 marks the zone where this pattern would be negated and would force a revision of the scenario.

Fundamental and geopolitical context

Iran’s rejection of the U.S. peace plan signals that tensions in the Middle East may persist for much longer than the market had originally anticipated. Such a scenario favors a steady inflow of capital into the dollar, a traditional safe-haven currency, and growing geopolitical uncertainty, combined with expectations of a return of inflationary pressure, creates solid foundations for a medium-term appreciation of the USD. Although the scale of the recent USD strengthening remains relatively moderate, historical analogies suggest that in similar, multi-vector crises, the dollar has tended to strengthen further.

Methodology and assumptions:


This recommendation is based on a technical analysis of the EURUSD chart. Classical technical analysis was used to assess the situation and analyze the trend. The target level—take profit 1—was set at the level of previous price reactions, using price action methodology. Take profit 2, on the other hand, is based on the location of this month’s local low. The protective stop-loss order was set above the most recent local high using price action methodology.

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EUR/GBP holds above 0.8650 as hawkish ECB comments support the Euro

  • The Euro regains ground against the Pound Sterling on Thursday, with the cross returning to the upper range of the 0.8600s.
  • EUR/GBP edges up following hawkish comments from ECB’s Nagel.
  • From a wider perspective, the cross remains sideways, with both currencies weighed by risk aversion.

The Euro (EUR) edges up slightly against the British Pound (GBP) on Thursday, yet moving within previous ranges, following downbeat German consumer confidence figures and hawkish comments by European Central Bank (ECB) member and Bundesbank President Joachim Nagel.

Nagel said earlier on Thursday that an interest rate hike in April will be an option at next month’s ECB meeting “if the war in the Middle East raises the spectre of an inflation surge in the Eurozone”.

These comments follow Wednesday’s remarks by ECB President Christine Lagarde, who affirmed that the central bank will have to respond “in a forceful pr persistent way” if consumer inflation looks set to be well above the bank’s 2% target. 

Higher borrowing costs might derail recovery

The prospect of higher interest rates amid sluggish economic growth in the region’s leading economies is keeping investors wary, weighing on demand for the common currency.

On Thursday, the German GfK Index showed that consumer confidence is expected to plunge to -28 in April from -24.8 in March. Data from Wednesday showed that the German IFO Business Climate deteriorated too, albeit less than expected, while the PMI survey underscored that the rise in energy prices could easily derail a tame economic recovery.

The Pound Sterling (GBP), however, is not faring much better, which keeps the cross in a choppy, sideways trading cycle. UK inflation data revealed that consumer prices remained at 3%, even before the start of the war, which has boosted market expectations that the Bank of England will be forced to hike rates more than once this year.