EUR/USD Rally Continues: Will Bulls Break Through 1.1820 Resistance?

EUR/USD is holding strong at 1.1755, and the momentum looks promising for the week ahead.

The euro is catching a bid this Friday morning in Europe, staying comfortably above the 1.1655 support level. What’s pushing the pair higher? The ECB’s December decision kept rates on hold, but here’s the kicker—the bank’s tone signaled no rush for further cuts anytime soon. Christine Lagarde made it clear they’re taking a “meeting-by-meeting” approach, meaning data will drive decisions, not preset playbooks. Most analysts expect rates to stay flat throughout 2026, giving the euro some breathing room.

Meanwhile, the dollar is facing headwinds on speculation that Trump will nominate a dovish Fed chief once Powell’s term wraps up in May. The market’s taking this seriously—if the next chairman keeps rates artificially low, it could weigh on USD strength and give EUR/USD room to run.

Technical Picture: Breakout or Fakeout?

Looking at the charts, EUR/USD is trading above the critical 100-day EMA (sitting at 1.1635), which keeps the medium-term trend firmly bullish. The RSI just hit 59.8, showing solid upside momentum but still far from overbought—plenty of runway left.

The pair is sandwiched between the Bollinger Band middle at 1.1738 and the upper band at 1.1820. That upper band is where the real action happens. Break above 1.1820 convincingly on a daily close, and we could see fresh legs higher. Slip back below 1.1738? That’s when sellers start eyeing the lower band near 1.1655.

The narrowing Bollinger Bands suggest volatility compression—expect a move soon. Until then, the bulls have the edge, and dips are looking like opportunities rather than warnings.