EUR/USD

Key insight

The July 23 ECB meeting is the single most important catalyst for this pair: a hold with dovish language would confirm the bear flag breakdown toward 1.1300, while a surprise hike or hawkish signal could invalidate the pattern and open 1.1500+.

EUR/USD is trading below the critical 1.1421–1.1441 resistance zone (broken Target Zone 2) and remains trapped inside a bear flag pattern, with the 150-pip Fed–ECB rate differential of 160bps capping upside and Middle East geopolitical risk supporting USD safe-haven demand.

Main risk

ECB Rate Decision – July 23, 2026

If the ECB surprises with a 25bp hike or signals September as a near-certainty, the EUR/USD bear flag collapses and the pair could re-test 1.1480–1.1500 within 48 hours, invalidating the bearish thesis.