EUR/USD under pressure ahead of today’s ECB decision. These are the key levels to watch

EUR/USD is under significant pressure heading into today’s European Central Bank (ECB) rate decision, with the pair sitting at a critical support zone after a sharp multi-week sell-off. A hawkish Federal Reserve hold yesterday, combined with surging energy prices driven by the ongoing Middle East conflict, has strengthened the US dollar broadly and pushed the euro to its lowest level since last July. The ECB is expected to hold rates unchanged today, but with markets now fully pricing in two rate hikes by end of 2026, President Lagarde’s tone at the press conference could prove just as important as the decision itself.

In our previous EUR/USD analysis, we covered the pair testing support following the FOMC surprise. Since then, the sell-off has extended meaningfully, and the technical picture has shifted.

Daily chart analysis

EUR/USD breaks below the 200 SMA for the first time since March 2025, with the ADL confirming sellers are taking control as price tests major support at 1.1400.

The most significant development on the daily chart is the break below the 200 SMA, which occurred at the start of March. This was the first time EUR/USD traded below this level since March 2025, which is notable given that the break above it last year marked the beginning of the pair’s substantial bull run.

Price is now testing a major support zone at around 1.1400, which represents the range lows from earlier in the consolidation period. This is an area where bulls are currently defending, but the pressure is building.

Two indicators are worth noting here:

• ADL (Advance Decline Line): For the first time since this trend began, the ADL has broken clearly to the downside. This suggests that, broadly speaking, sellers have started to dominate the current structure and buying participation has weakened.
• RSI: Momentum is at its most oversold reading since the beginning of the bull trend. While this does not automatically signal a reversal, it does open the door to potential bullish divergence forming at this support zone, which could point to a relief rally.

The two levels to keep on the radar on this timeframe are the range lows support around 1.1400 below and the range equilibrium resistance at around 1.1600, which also aligns with the 200 SMA. A confirmed break below 1.1400 could bring the next major support zone, sitting between 1.1100 and 1.1200, into focus.

4-hour chart analysis

Price is holding within the 0.618–0.786 Fibonacci retracement zone, with 1.1535 as the key level to reclaim and the ECB decision set to drive the next directional move.

Zooming into the 4-hour chart, price is currently testing the 1.1450 area, which sits within a local support zone defined by the 0.618 to 0.786 Fibonacci retracement levels. This is the area the arrow on the chart is pointing to, and it is where price has been finding some short-term basing activity.

The immediate resistance above sits at 1.1535, a level that has acted as a clear boundary in recent sessions and needs to be reclaimed for any short-term recovery to gain traction.

Two scenarios to watch ahead of the ECB decision:

• Bullish: A hold of the current Fibonacci support zone and a break above 1.1535 could open the door to a retest of the daily 200 SMA around 1.1675.
• Bearish: A break and close below the local support zone could leave a significant gap to the downside before the next high time frame level at 1.1100 to 1.1200.

The ECB press conference later today is the key near-term catalyst. Any hawkish surprise from Lagarde could provide a short-term floor for the euro, while a cautious or dovish tone risks accelerating the current decline.

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