EUR/USD

Key insight

With the ECB nearly fully priced to hold at 2.25% on 23 July and the Fed's Warsh dismissing two soft CPI prints as insufficient for a policy pivot, neither central bank is providing the rate-divergence signal needed to break EUR/USD out of its 1.1300–1.1480 consolidation range.

EUR/USD is range-bound near the critical 1.14 support zone, trapped between a bear flag technical pattern below 1.1480 resistance and macro forces that are too evenly balanced to drive a clean directional break ahead of the ECB decision on 23 July and the Fed on 29 July.

Main risk

Middle East Escalation / Strait of Hormuz Blockade

Trump's reinstatement of the Iranian shipping blockade has sent oil prices higher, reigniting inflation fears and prompting safe-haven demand for the USD — if crude extends its rally, the Fed's hawkish-hold stance is reinforced and EUR/USD risks breaking below the 1.1300 bear-flag target.