The EUR/USD pair on Monday returned to the 50.0% retracement level at 1.1745, rebounded from it, and reversed in favor of the US dollar. Thus, the decline may continue today toward the 38.2% Fibonacci level at 1.1666. Consolidation above the 1.1745 level will favor the euro and a resumption of growth toward the 61.8% retracement level at 1.1824.

The wave structure on the hourly chart currently raises no concerns. The last completed upward wave broke six previous peaks, while the latest downward wave did not come close to the previous low. A temporary truce between Iran and the United States supported the bulls, allowing them to form a strong upward wave. Thus, the current trend is bullish. In the near term, the geopolitical background may deteriorate again, which would strengthen bearish sentiment. However, breaking the bullish trend will now require two downward waves or a break below the April 6 low.

On Monday, the economic background was limited to one report that initially drew little interest. Germany's GfK consumer confidence index was released and came in worse than already weak forecasts. However, in the first half of the day, the euro showed no weakness, and in the second half it declined, but clearly not due to the GfK index. Thus, no important news was released on Monday, and traders remain in a waiting mode. This week will bring important releases (Q1 GDP, inflation, ISM index), as well as meetings of the Federal Reserve, the ECB, and the Bank of England. Therefore, the most significant developments this week are still ahead. There will be many events, and traders should not forget that geopolitics continues to play an important role in market sentiment on a daily basis. There are currently no major updates, but new developments are likely, as the Middle East conflict cannot remain frozen indefinitely and should reach a logical outcome.

On the 4-hour chart, the pair reversed in favor of the euro and consolidated above the 61.8% Fibonacci level at 1.1706. Thus, growth may continue toward the next retracement level of 50.0% at 1.1778. Consolidation below 1.1706 will favor the US dollar and a resumption of the decline toward the 76.4% retracement level at 1.1617. No emerging divergences are observed on any indicators today.

Commitments of Traders (COT) report:

During the last reporting week, professional traders opened 2,768 Long positions and closed 12,538 Short positions. Over seven weeks, the overall bullish advantage disappeared, but the last two weeks indicate that bulls have resumed buying activity. The total number of Long positions held by speculators is now 217,000, while Short positions amount to 176,000. The gap is widening again in favor of the euro.

In the long term, major market participants continue to show strong interest in the euro. However, global events, which have been abundant in recent years, continue to influence investor sentiment. In particular, the market's attention remains focused on the Middle East, where the war has only been paused, not concluded. Therefore, in the near term, the euro and US dollar exchange rates will depend not on Federal Reserve or ECB monetary policy or economic data, but on developments in Iran.

News calendar for the US and the Eurozone:

• US – ADP Employment Change (12:15 UTC).
• Eurozone – Speech by ECB President Christine Lagarde (18:30 UTC).

On April 28, the economic calendar contains two secondary events. The impact of the news background on market sentiment on Tuesday is expected to remain very limited.

EUR/USD forecast and trading tips:

Selling positions were possible on a rebound from the 1.1745 level on the hourly chart, targeting 1.1666. These positions can still be held today. If the price consolidates below 1.1666, positions may be held with a target at 1.1568. Buying positions are recommended on a close above 1.1745 with a target at 1.1824, or on a rebound from the 1.1666 level.

Fibonacci retracement levels are drawn from 1.2082–1.1410 on the hourly chart and from 1.1474–1.2082 on the 4-hour chart.