EUR/USD Weekly Outlook: Key Levels Ahead
Last Week’s Price Action Recap
The week ending July 3rd delivered mixed signals across major forex pairs, with EUR/USD exhibiting the most compelling technical setup heading into the new trading week.
EUR/USD kicked off the week at 1.1368 on Tuesday (June 24th) and endured a consolidation phase through mid-week, dropping to a low of 1.1324 before staging a recovery. The pair closed Friday at 1.1435—near the upper end of the week’s range—signaling renewed bullish momentum. This represents a 111-pip rally from the lows and suggests that sellers are beginning to lose grip after a volatile month of June.
GBP/USD similarly posted a bullish close, though with less conviction than its euro counterpart. Sterling struggled against a stronger dollar early in the week but recovered modestly by Friday’s close, indicating that support levels around the 1.25 region are holding.
USD/JPY showed relative strength throughout the week, benefiting from safe-haven flows and a steeper yield curve differential favoring US rates. The pair remains well-supported above 151.50, with bulls maintaining control of the broader uptrend.
The dominant theme: risk-on sentiment is returning, but macro headwinds (particularly around global growth concerns and central bank policy divergence) are keeping traders cautious. Volatility remains elevated heading into a data-rich week.
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Get Free EAs →Key Technical Levels to Watch This Week
EUR/USD
- Resistance: 1.1460 (intraweek high, July 2nd) | 1.1510 (psychological level)
- Support: 1.1350 (daily moving average confluence) | 1.1300 (weekly low, June 24th)
- Pivot Zone: 1.1400–1.1420
Context: EUR/USD is trading near the upper band of its recent consolidation. A daily close above 1.1460 would suggest a breakout attempt toward 1.15 (a level not seen in six weeks). Conversely, a rejection below 1.1350 signals a return to downside pressure.
GBP/USD
- Resistance: 1.2650 (2-week high) | 1.2700 (round number)
- Support: 1.2550 (daily support zone) | 1.2480 (weekly low)
- Pivot Zone: 1.2590–1.2620
Context: Sterling is caught between dollar strength and the prospect of a Bank of England hold on rates. Expect consolidation unless either currency produces an outsized data print.
USD/JPY
- Resistance: 152.50 (intraweek high, June 30th) | 153.00 (major resistance)
- Support: 151.50 (solid floor) | 150.80 (moving average)
- Pivot Zone: 151.80–152.10
Context: The yen remains under pressure due to the widening rate differential between US and Japanese yields. A break above 153.00 would open the door toward 155.00, but watch for Bank of Japan commentary to shift sentiment quickly.
The Week Ahead: Macro Calendar & Market Impact
Monday, July 7th
- Australia: RBA Minutes (Tuesday AEST, early Monday UTC)
- Expected Impact: LOW to MODERATE. The Reserve Bank of Australia’s June meeting minutes will reveal whether officials see further rate hikes as likely or if the hiking cycle has peaked. Look for dovish language to weigh on AUD.
Tuesday, July 8th
Eurozone: CPI Flash Estimate (Preliminary) – 11:00 UTC
- Expected Impact: HIGH. This is the marquee event for the euro this week. Markets are pricing in headline inflation cooling to 2.2% YoY (from 2.4% previously), which would bring it closer to the ECB’s 2% target. A hotter-than-expected print could reignite rate-hike bets and support EUR/USD. A cooler print may trigger a euro selloff.
US: Consumer Price Index (Core & Headline) – 12:30 UTC
- Expected Impact: VERY HIGH. The June CPI report is critical for Federal Reserve policy expectations. Any surprise to the upside risks a sharp dollar rally as traders reprice Fed cut odds downward. Core CPI expected at 0.3% MoM; headline at 0.1% MoM.
Wednesday, July 9th
UK: Retail Sales (June) – 08:00 UTC
- Expected Impact: MODERATE. British retail sales data will provide insight into consumer health post-election. Weaker sales could signal the BoE may need to cut sooner than expected, weighing on sterling.
US: Initial Jobless Claims & Continuing Claims – 12:30 UTC
- Expected Impact: MODERATE to HIGH. Weekly jobless figures remain a key labor-market indicator. Rising claims might suggest the Fed has space to cut rates, supporting a softer dollar.
Thursday, July 10th
Eurozone: Sentix Investor Confidence Index
- Expected Impact: LOW. A secondary indicator, but sentiment data can influence intraday risk appetite.
Bank of Japan: Ueda Speech – time TBA
- Expected Impact: MODERATE to HIGH. Any commentary on the yen weakness or monetary policy stance could shift USD/JPY dynamics sharply. Watch for dovish signals that might cap the dollar’s rally against the yen.
Friday, July 11th (End of Week)
- US: Core Retail Sales & University of Michigan Consumer Sentiment (Preliminary)
- Expected Impact: MODERATE. These indicators cap the week and may drive final positioning ahead of the weekend. Strong sentiment data could bolster risk appetite and weigh on safe-haven currencies.
Trading Scenarios for the Week
Scenario A: The Bullish EUR/USD Path
Triggers:
- Eurozone CPI comes in softer than expected (headline at or below 2.1%), confirming disinflation is on track.
- US CPI posts a 0.0% MoM print, triggering renewed Fed cut expectations.
- Risk appetite rebounds as growth concerns ease.
Target Levels: EUR/USD 1.1480 → 1.1510 → 1.1550
Probability: 45%
Rationale: A dovish divergence between the ECB and Fed (with the latter forced to pivot toward cuts while the ECB remains data-dependent) would favor the euro. Technical breakdown above 1.1460 would confirm this scenario.
Scenario B: The Bearish EUR/USD Path
Triggers:
- Eurozone CPI surprises to the upside (headline 2.5%+ YoY), suggesting inflation remains sticky.
- US CPI accelerates, particularly in shelter and services, pushing back Fed cut timeline to Q4 2026 or later.
- Risk-off sentiment re-emerges as growth concerns resurface.
Target Levels: EUR/USD 1.1350 → 1.1300 → 1.1200
Probability: 35%
Rationale: A stronger-for-longer Fed policy stance combined with persistent eurozone inflation would weigh on the euro and support the dollar. A break below 1.1350 would signal a return to the downtrend.
Scenario C: The Consolidation Trade
Triggers:
- Both CPI prints come in line with expectations, offering no directional conviction.
- Central bank speakers deliver measured, non-committal commentary.
- Risk sentiment remains mixed—neither risk-on nor risk-off dominates.
Trading Range: EUR/USD 1.1350–1.1460
Probability: 20%
Rationale: This is the base case if data meets consensus. Traders would likely range-trade within the established technical zone, with the 1.1400 pivot point serving as a key decision point.
Technical Setup Summary
EUR/USD is at an inflection point. Friday’s close at 1.1435 positions the pair at the upper boundary of a four-week consolidation range. The week of July 7th will determine whether bulls break higher or sellers reclaim control. The Eurozone CPI report on Tuesday and US CPI on the same day form the critical catalyst.
A close above 1.1460 on daily timeframe would suggest a genuine breakout, opening 1.1550 as the next target. A daily close below 1.1350 would signal a retest of the 1.13 handle.
For GBP/USD, watch 1.2650 for resistance confirmation. For USD/JPY, the 152.50–153.00 zone is where bulls need to establish authority.
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This analysis is for educational purposes only and does not constitute financial advice. Trading forex carries significant risk. Past performance is not indicative of future results.