1. Fundamental Analysis
🇺🇸 United States
Warsh Nomination Boosts USD
• Kevin Warsh is viewed as a more hawkish, balance sheet reducing, independence supporting Fed chair candidate — strengthening USD broadly.
• The USD saw its strongest daily recovery since May, reversing EURUSD’s multi week bullish momentum.
Fed Outlook: 2 Cuts Expected, but Less Aggressive
• Markets still price two Fed rate cuts in 2026, but Warsh is expected to cut more gradually, limiting downside in the USD.
US Inflation Surprise Supports USD
• The most recent US PPI report came in “much higher than expected,” interpreted as hawkish for the Fed and helping USD rebound.

🇪🇺 Eurozone / Broader EUR Dynamics
EUR Still Supported by Macro Trend, But Cooling
• EURUSD rallied more than 4% from January lows, testing a multi year resistance zone at 1.1917–1.2020, where the rally stalled.
Resistance Zone Creates Inflection Risk
• The multi year barrier includes the 2025 swing high, Fibonacci confluences, and long term structural resistance.
A rejection here explains the current corrective pressure.

2. Technical Analysis
Trend Structure:
Bullish but weakening short term
Breakout & Correction Sequence
• Early January: EURUSD broke out of 1.1600–1.1700, then accelerated past 1.1800, reaching 1.2050–1.2100.
• Current: Price retracing into 1.1850–1.1870, still holding above former resistance (1.1830–1.1850), now turned support.
Indicators
• Stochastic: Turning down from overbought → continued pullback risk
• MACD: Still positive but histogram contracting → slowing bullish momentum
• Bollinger Bands: Volatility expanded during the rally; correction now moving back toward mid band.
Multi Timeframe View
• Daily/Weekly: Price stalled at major multi year resistance (1.1917–1.2020).

Key Support Levels
• 1.1870 – Nearest technical support
• 1.1830–1.1850 – Critical structure support
• 1.1746–1.1750 – First major weekly support (yearly open zone)
Key Resistance Levels
• 1.1980–1.2000 – Break confirms correction end
• 1.1917–1.2020 – Multi year barrier
• 1.2050 – Local January peak

3. Trading Scenarios
Bullish Scenario (Primary Medium Term Bias)
Trigger: Price regains 1.1980 and closes above 1.2000.
Targets:
• 1.2050
• 1.2100
• Extension: 1.2218 (higher timeframe resistance)
Rationale:
Correction appears technical as long as price holds above 1.1830–1.1850.

Bearish Scenario (Short Term Correction Continuation)
Trigger: Daily close below 1.1830.
Targets:
• 1.1750
• 1.1600 (deep correction)
Rationale:
Warsh nomination + strong USD data could fuel deeper retracement.

4. Market Sentiment
• EUR sentiment: Cautiously bullish; rally losing momentum at multi year resistance
• USD sentiment: Strengthening after Warsh nomination and high PPI
• Volatility: Elevated — geopolitical and leadership shifts driving rapid flows
• Bias: Medium term bullish, short term corrective