EUR/USD is heading higher: the MACD indicator confirms bullish strength above 1.1735

During recent sessions in the foreign exchange market, the EUR/USD pair shows clear signs of strength, driven by favorable macroeconomic fundamentals. The US dollar has been weakening for the second day, retreating from four-month highs amid rising market expectations of the Federal Reserve maintaining a dovish stance. Simultaneously, speculation that the European Central Bank has ended its cycle of interest rate cuts supports the euro and is reflected in the strengthening of the EUR/USD pair.

Rebound supported by fundamentals and MACD indicator in positive territory

The currency pair is regaining value around 1.1710 after falling to nearly a four-week low close to 1.1660 on Monday. The current quote at 1.1735 reflects a 0.10% increase during the session and suggests solid fundamentals for further gains. A key supporting signal for this outlook is the change in the MACD indicator, which has turned positive and shows a clear upward trend. This shift indicates increasing buying momentum and is an important signal for investors seeking confirmation of an uptrend.

It is worth noting that the MACD indicator, traditionally considered one of the most reliable oscillators, moving into positive territory indicates a shift in market dynamics in favor of the bulls. Additionally, the Relative Strength Index (RSI) at 59 suggests the potential for further strengthening without overheating the market.

Technical convergences: Fibonacci, SMA, and MACD signals

The 1.1735 level represents a significant cluster of technical resistance, where the 100-hour simple moving average (SMA) and the 50% Fibonacci retracement of the decline from 1.1808 to 1.1660 converge. It is at this zone that the MACD indicator confirmed its shift into positive territory, reinforcing the credibility of this level as a potential point for resuming EUR/USD appreciation.

The nearest significant technical resistance is near the 61.8% Fibonacci retracement, around 1.1700, in the middle of the range. Breaking above this level would strengthen the scenario of a corrective rebound and could open the way for further gains.

Upside scenario: where to look for a breakout and what are the risks

The current technical setup, confirmed by MACD signals, suggests that the next move for EUR/USD should be higher. However, failure to overcome key technical resistance levels could cause the pair to revert to its recent consolidation range and test support at 1.1660.

Investors monitoring this pair should closely observe whether the MACD remains in positive territory and continues to generate confirmations, which would be additional evidence supporting an uptrend. Given the current market fundamentals and emerging technical signals, EUR/USD appears well-positioned for further gains, provided indicators like MACD do not send warning signals.