Created on December 29, 2025

EUR/USD Analysis Summary Today

• Overall Trend: Bullish
• Support Levels for EUR/USD Today: 1.1745 – 1.1680 – 1.1600.
• Resistance Levels for EUR/USD Today: : 1.1830 – 1.1880 – 1.1930.

EUR/USD Trading Signals:

• Buy EUR/USD from the support level of 1.1690 with a target of 1.1820 and a stop-loss at 1.1600.
• Sell EUR/USD from the resistance level of 1.1830 with a target of 1.1500 and a stop-loss at 1.1900.

Technical Analysis of EUR/USD Today:

The Euro is stabilizing against the US Dollar (EUR/USD) near the 1.1800 resistance as the final trading days of 2025 begin. This sets the stage for a strong performance heading into 2026. According to top-tier trading platforms, Euro trading has remained positive, fueled by market expectations regarding the future policies of the US Federal Reserve compared to those of the European Central Bank (ECB).

Amidst quiet holiday trading between Christmas and the New Year, the exchange rate settled near 1.1772. The US Dollar remains under pressure despite strong US growth data. Recently, financial markets have shifted their focus toward Federal Reserve policy outlooks and concerns over central bank independence, rather than short-term economic activity indicators.

With long positions on the euro increasing, the potential for further gains may depend on the emergence of new catalysts in early January.

Will the Euro’s gains continue in the coming days?

According to forex market trading, the euro (EUR) remained stable in global markets last week, while the dollar remained under pressure despite better-than-expected US GDP data. Consequently, the EUR/USD exchange rate reached its highest level in three months, approaching 1.1810, before settling slightly below 1.18.

Regarding factors influencing currency prices, any developments related to the incoming Federal Reserve Chair and other US central bank officials will be closely monitored. Looking ahead, MUFG Bank anticipates further limited net losses for the dollar in 2026 due to interest rate changes. They stated, “We expect the European Central Bank to maintain its current monetary policy throughout 2026, justifying the EUR/USD exchange rate’s rise in short-term yield movements, given that the Federal Reserve is poised to cut interest rates at least three times, exceeding expectations.”

After an initial stabilization, the bank expects the EUR/USD exchange rate to reach 1.24 by the end of 2026.

Trading Advice:

Traders advise caution when trading during periods of low market liquidity, a natural reaction to holidays in many financial markets.

2026 Trading Outlook:

According to currency trading experts, the US dollar is likely to remain vulnerable to volatility in global markets until the start of the new year. However, the latest Commitments of Traders (COT) data from the Commodity Futures Trading Commission (CFTC) shows an increase in non-commercial long positions in the euro to nearly 145,000 contracts from 138,000 contracts previously, its highest level in two years. This concentration will increase the risk of a euro correction early next year. Very strong resistance is also likely for the EUR/USD pair on any move towards the psychological resistance level of 1.20.

On the Economic Front, US GDP data for the third quarter showed annualized growth of 4.3%, compared to 3.8% previously, exceeding analysts’ expectations of 3.3%. Consequently, financial markets are currently trading at a probability of less than 15% for another US interest rate cut by the Federal Reserve in January, with two further cuts expected in 2026.

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Created on December 29, 2025

Potential signal:

• I am fine with buying this pair at these levels, with a target of 158 and a stop at 155.
• The US dollar continues to see range-bound behavior against the Japanese yen on Friday.
• The US dollar has rallied just a bit against the Japanese yen in what would have certainly been thin Friday trading.

Half of Europe was celebrating Boxing Day or something similar to it, and the United States, although technically open, has most people away from work and ignoring the markets in general.

The market has done exactly what you would expect in the scenario that we find ourselves in, and it’s continued the overall consolidation. The interest rate differential does favor the US dollar, and therefore I think there’s nothing wrong with buying it, but I do recognize that there’s a very real anti-US dollar sentiment at the moment and that will lead to more volatility.

The 50-day EMA sits right around the 154.50 level, which is basically the floor in the consolidation that we have been involved in for the entire month of December.

Market Sentiment and Interest Rates

Over the longer term, I would still favor the US dollar over the Japanese yen. That’s not really a US dollar call; that’s more about the Japanese yen than anything else, as you can see several other currencies around the world working their way higher against the yen as well.

The Bank of Japan did hike rates, but I think traders at this point in time have voiced their opinion of that as the Japanese yen continues to be fairly soft.

It is not until we break down below the 153 yen level that I even begin to have the conversation of maybe the trend could be changing. I’m a buyer of dips. I think we’ll get back to 158 yen, and I do think we eventually break above there.

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Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.

The EURJPY pair began with clear negativity this morning, by forming a new corrective decline by targeting 183.75 level, due to providing negative momentum by stochastic by reaching below 50 level, besides forming extra barrier at 184.40 level.

We expect providing more corrective attempts, which might target 183.55 level reaching the main support at 183.05, while surpassing the mentioned barrier and holding above it will confirm its readiness to renew the bullish attempts, repeating the pressure on 184.90 level to find an exit to record new historical gains in the upcoming period.

The expected trading range for today is between 183.05 and 184.00

Trend forecast: Bearish

Created on December 29, 2025

• The British Pound has outperformed most of its contemporaries against the US dollar, so even if the US dollar finds quite a bit of strength, it is more likely than not that the British Pound drifts lower, but at a slower speed.
• The British Pound initially rallied during the trading session on Friday, but then gave back quite a bit of significant momentum.
• With that being the case, traders will likely look at this through the prism of a market that is going to try to either break out or form a bit of a consolidation range.

I do believe that in the next couple of weeks we will make a significant decision, but as things stand right now, it looks very much like a market that I think is going to continue to see a lot of questions asked of it near the 1.35 level.

Levels to Watch

The 1.35 level is a level that I think has been important multiple times. If we pull back from here, and I think we could, the 1.34 level is an area that would be your initial target. Breaking down below there, then opens up the possibility of a drop down to the 1.32 level. All things being equal, I suspect that might be the initial move to a bigger pullback.

However, we have to understand that the US dollar will probably move in the same direction against most currencies and not just this one. So, with this, I think you have a scenario where if we were to break above the 1.36 level, then it is obvious that we have a much bigger move to the upside waiting to happen, perhaps to the 1.38 level. I do expect a lot of choppy and noisy behavior, but I also recognize that the British Pound has outperformed most of its contemporaries against the US dollar. We are at a major point of inflection that we need to be watching.

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Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.