EUR/USD Consolidation Phase: 1.1820 Resistance Looms as Uptrend Sustains Above 1.1635 EMA

EUR/USD hovers near 1.1755 with solid technical structure supporting further upside potential.

On Friday morning’s European trading, EUR/USD maintains its bullish undertone with the pair firmly positioned above its 100-day exponential moving average. The technical setup appears constructive, with the Relative Strength Index climbing toward 60, indicating strengthening momentum while keeping distance from overbought territory—a balanced signal that favors continuation buyers over exhaustion sellers.

Market Dynamics Fueling EUR Currency

The European Central Bank’s recent December policy decision reinforced a cautious stance toward monetary easing. ECB President Christine Lagarde underscored the institution’s commitment to data-dependent decision-making on a meeting-to-meeting basis, effectively signaling no predetermined rate trajectory. Market participants have adjusted expectations accordingly, with many economists now pricing in rate stability extending through 2026. This measured approach has lent underlying strength to the Euro.

Simultaneously, developments on the US side could inject additional support for EUR/USD. Speculation surrounding President Donald Trump’s selection for the next Federal Reserve Chair—whose mandate concludes in May—has created uncertainty about future policy direction. Trump’s public statements favoring accommodative rates and central bank alignment with executive preference have intensified concerns about institutional independence, potentially weighing on Dollar sentiment in the near term.

Technical Landscape: Structure Remains Intact

The daily timeframe reveals EUR/USD trading comfortably above the 1.1635 EMA, a development that preserves the intermediate-term bullish case. The Bollinger Bands configuration shows tightening bands around the 1.1738 midpoint, suggesting volatility compression following the recent rally—a setup typically preceding directional expansion once momentum reignites.

The critical resistance level materializes at 1.1820, marked by the upper Bollinger Band, representing the immediate ceiling for bullish conviction. A break above this barrier could unlock further extension. Conversely, the support zone anchors at 1.1655 near the lower band; any retracement below the middle band would shift focus toward this level. Until volatility picks up, the technical alignment remains favorable for positioned longs on dips, provided the pair holds above its 100-day EMA foundation.