EUR/USD Price Forecast: Pair Holds 1.17 While Bears Target 1.1660 Before US Jobs

EUR/USD holds 1.17 as soft Euro data meets Fed and jobs risk

EUR/USD structure around 1.1690–1.1700 and current trend

EUR/USD trades near 1.1690–1.1700 in a controlled correction from the late-December high at 1.1808. Price sits above the rising 50-day EMA at 1.1684 but below the 9-day EMA near 1.1724, which signals digestion of the drop rather than a clean trend reversal. On the daily chart, the 14-day RSI is around 47, confirming fading upside momentum and a neutral-to-soft bias instead of a strong bullish setup. The market is effectively pausing under 1.1700 after failing to extend the breakout above 1.1755 and 1.1808, with sellers slowly regaining control but without capitulation on either side.

Euro fundamentals: inflation, Germany and services cooling

On the Euro side the macro data does not justify aggressive strength in EUR/USD. Eurozone headline HICP slowed to 2.0% year-on-year in December from 2.1%, exactly matching expectations, while core HICP dropped to 2.3% from 2.4%, beating the 2.4% consensus on the downside. That combination signals softer underlying inflation and keeps the European Central Bank under pressure to stay dovish through 2026, which structurally caps sustained moves above 1.18. Germany adds another layer of weakness. Retail sales fell 0.6% month-on-month in November after a 0.3% decline in October, against a forecast for a 0.2% increase, showing a consumer that is still struggling. Year-on-year, sales grew 1.1% after 0.9%, but the back-to-back monthly contractions matter more for near-term growth. On prices, German HICP dropped to 2.0% year-on-year in December from 2.6%, below the 2.2% market expectation and reinforcing the message of decelerating inflation. Services activity is also cooling. Eurozone S&P Services PMI for December was revised down to 52.4 from 52.6 and from 53.6 in November. The index remains above 50, so the sector is still expanding, but the direction is negative. Combined — softer inflation, weak German consumption and a downward-revised services PMI — these prints argue that EUR upside should remain limited unless the USD side delivers a clear bearish shock.

Dollar side: DXY near 98.5 and Fed uncertainty

On the USD side the Dollar Index trades around 98.6 inside a rising short-term channel. Immediate supports sit near 98.50 and 98.15, with resistance levels at roughly 98.85 and 99.07. Price action in this band is consolidation, not a breakdown, which means the dollar retains a mild underlying bid. Fed communication is mixed and keeps the dollar capped but supported. One policymaker argues for deeper rate cuts in 2026 to protect growth, another warns that unemployment will rise if the economy slows too much, and a third pushes hard for strict data-dependence on both inflation and employment. On top of that, markets know a new Fed chair will be named by President Trump, which adds another layer of uncertainty to the forward path for policy. Fed funds futures currently price roughly an 82–83% probability that rates stay unchanged at the mid-January meeting, so there is no immediate shock but significant optionality beyond that date. The macro calendar now dominates the USD story. ADP Employment Change is expected at +47,000 after a −32,000 print, JOLTS job openings are seen easing slightly to 7.6 million from 7.67 million, ISM Services PMI is projected at 52.3 versus 52.6, and Nonfarm Payrolls are forecast around +55,000. Stronger-than-expected numbers would push yields and the dollar higher, while a weak cluster would reinforce the case for a softer USD and a relief bounce in EUR/USD. Geopolitical tensions, including the U.S.–Venezuela situation, are not providing meaningful safe-haven support for the dollar at this stage; price action shows that Fed expectations and hard data remain the dominant drivers.

Short-term price map: support at 1.1660–1.1650, resistance at 1.1755–1.1808

Intraday, EUR/USD is trading around 1.1685–1.1700 and has been reacting repeatedly to a rising trendline that has guided the pair higher since early December. Dips toward 1.1660 have attracted buyers, confirming that real money is defending that band ahead of the key 1.1650 support. The broader structure still shows higher lows since early December, but the inability to hold above 1.1755 and the subsequent failure at 1.1808 have turned the recent move into a recognizable corrective phase. First support now sits at 1.1660–1.1650, followed by the December 8–9 lows around 1.1615 and then the early-December base. On the topside, resistance starts with the 9-day EMA at 1.1724. Above that sits a dense supply pocket at 1.1705–1.1755, capturing the descending trendline from the December high and a local swing high. The major levels beyond are 1.1808, the three-month peak, and 1.1918, the highest level since June 2021. As long as EUR/USD trades below 1.1755–1.1808, that area should be treated as a selling zone rather than the beginning of a new bullish trend. On the 4-hour chart, the MACD histogram oscillates around the zero line, confirming a lack of strong directional momentum, while the RSI sits around 40–45, pointing to a mild bearish bias with no oversold conditions. This combination matches the price reality: a controlled downtrend from 1.1808, stalled under 1.1700 but still vulnerable to a break of 1.1660 if the data turns in favor of the dollar.

FX board context: how EUR is trading versus majors

Cross-section currency data confirm that EUR is not in a collapse phase but also not leading the board. In one snapshot the Euro gains about 0.11% versus USD and roughly 0.13% versus CAD, while trading almost flat against GBP. In another, it is essentially unchanged versus the dollar at around −0.01% and marginally stronger against the pound. Moves of 0.1–0.2% across majors highlight extremely low FX volatility as traders wait for the U.S. employment cluster. For EUR/USD this means the pair is not being crushed by a runaway dollar; it is drifting because Eurozone data are soft and the market refuses to fully price aggressive Fed cuts without confirmation. Until one side breaks — either a clear euro surprise or a decisive dollar miss — the most rational expectation is that EUR/USD continues oscillating inside the 1.1650–1.1755 band rather than launching a clean trend.