EUR/USD Bounced Back to 1.1730: Upcoming ECB Meeting Might Impact
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Ultra-Compact Summary Section Summary EUR/USD bounced from the 1.1725–1.1730 region The US Dollar (USD) is struggling to hold gains due to the Fed rate hike The unresolved US-Iran conflicts add safe-haven demand to the USD Upcoming European Central Bank (ECB) meeting data is of concern
EUR/USD turns positive around the 1.1730 level on Monday, April 27, 2026, after sliding from a two-month peak of 1.1850 on Friday.
Key Drivers Behind the EUR/USD Move
The Iran-US conflict negotiations halt, the worldwide energy crisis, and expectations of an upcoming ECB rate hike are the key drivers.
Iran-US Conflicts & Negotiations Halt:
As the Iran-US peace negotiation talks were interrupted, EUR/USD fell sharply last week. The seizure of an Iranian vessel by US authorities undermined a fragile ceasefire, pushing Brent crude above $103 per barrel and deepening economic uncertainty across the eurozone.
Energy Crisis
New data also showed that businesses across the eurozone struggled in April — the worst slowdown since late 2024. Higher energy bills, driven by tensions in the Middle East, are hurting everyday spending and the services industry. On top of that, Germany, Europe’s biggest economy, cut its 2026 growth outlook in half due to the same energy crisis.
US Dollar Losing Strength
Meanwhile, the US Dollar is losing some of its strength. Traders no longer expect the US Federal Reserve (the Fed — America’s central bank) to raise interest rates anytime soon. When rate hike expectations fall, the dollar weakens, which gives the euro a chance to recover.
ECB Rate Expectations
All eyes are also on the European Central Bank’s (ECB) upcoming meeting, which is set to meet soon. Most expect the ECB to keep rates unchanged for now. But if officials drop even a small hint that rate hikes are coming, the euro could jump quickly. Markets are already betting on at least two rate increases in Europe before the end of 2026.
Technical Indicator Outlook
The EUR/USD pair is trading just above the 23.6% Fibonacci retracement of the recent rally from late March lows, a level that sits near 1.1754.
- Support: ~1.1730, 20-day EMA
- Resistance: ~1.1770, 100-hour EMA
Market Sentiment: What Should Traders Do Now?
- Wait for price to clearly hold above 1.1770 (100-hour EMA) before considering any long positions. A confirmed close above this level opens the path toward 1.1849.
- A confirmed break and close below 1.1730 could expose 1.1695 and then 1.1648. However, fading Fed rate expectations make strong USD rallies less likely — trade carefully.
- Monitor the US-Iran peace talk headlines and ECB meeting signals closely. These two factors will be the most powerful short-term catalysts for EUR/USD direction this week.
- A confirmed break and close below 1.1730 could expose 1.1695 and then 1.1648.
Overall market sentiment for EUR/USD is cautiously bullish as long as 1.1730 holds. However, the geopolitical overhang and mixed eurozone fundamentals mean that any upside beyond 1.1850 will require fresh catalysts.
About the author:
Sarah ThompsonLead Forex Strategist & Financial Writer
Sarah Thompson is a professional Forex trader with over 7 years of experience in the financial markets. She specializes in Forex trading strategies, technical analysis, Gold and Indices market trends, risk management, and performance evaluation. Since joining SureShotFX in 2021, Sarah has authored numerous in-depth articles, reports, and insights for traders of all experience levels.
