EURUSD: Weekly Support Inflection at 1.1724

Directional Bias

Reactive Long — wait for confirmation at 1.17246-1.17391 before engaging. The structural case for EURUSD higher is intact at the weekly timeframe, anchored by DXY below 100, a Fed on a cutting path, and persistent institutional demand for EUR on dips. However, the H4 is in a corrective leg from last week's triple rejection at 1.18488, and Monday opens directly on the critical weekly support zone. The bias is not to short this pullback — the weight of structure argues against it. The bias is equally not to buy blindly into a support zone on an event-risk Monday with the Warsh hearing one day away. The play is reactive: if London open confirms support (bullish H4 close above 1.17391, ideally reclaiming 1.17529-1.17666), the setup favours longs targeting the 1.17666 → 1.18108 range. Invalidation: an H4 close below 1.17100.

Regime & Market Context

The multi-timeframe regime is a textbook pullback-in-uptrend. The weekly trend has been building higher lows since November 2025, and the April impulse from 1.15047 to 1.18488 — driven by soft US CPI, soft PPI, and a broad dollar diversification following the Liberation Day tariff shock — was structurally healthy. The daily is now consolidating that impulse, with price compressing back toward the breakout base. The H4 has entered a short-term corrective phase after a progressively sharper triple rejection from the 1.18+ ceiling, with the most recent spike (1.18488 on April 17) closing as a bearish rejection candle. The regime is not distribution — it is digestion. The market is in a "prove it" phase at support, asking whether institutional buyers defend the weekly pivot or allow a deeper unwind. With FOMC and ECB both next week, this week functions as a positioning week rather than a trend week, implying range compression and event-driven directional breaks over smooth trending sessions.

Key Levels

Level	Type	Origin	Expected Reaction
1.18235 – 1.18488	Resistance Zone	Triple-top rejection: Apr 13, 16, 17 H4 highs	Strong rejection; requires D1 close above 1.18488 to confirm break
1.17529 – 1.17666	Near-term Resistance	Apr 13-16 consolidation base — now flipped to resistance	First meaningful hurdle on bounces; reclaiming this zone neutralises H4 bearish pressure
1.17246 – 1.17391	Primary Support	W1 close, Apr 9-10 breakout base, prior structural pivot	Critical decision level this week — hold confirms higher-low, break opens deeper correction
1.16636 – 1.16771	Secondary Support	Apr 12-13 daily lows, ~50% retracement of April impulse	Only relevant if 1.17246 breaks cleanly on H4; still within normal bullish pullback territory
1.19284 – 1.20815	Upper Target Zone	Feb 2026 highs and Jan 2026 spike high	Medium-term bull continuation target once 1.18488 yields
1.15047 – 1.15218	Macro Structural Floor	Liberation Day tariff-shock low (Apr 4-5)	Revisit would signal full trend reversal — not a near-term consideration

Stop clusters are concentrated below 1.17246 (recent long entries from the April breakout) and above 1.18488 (shorts fading the triple top). A false sweep below 1.17246 followed by a recovery would be consistent with the typical London open liquidity grab pattern.

Market Structure

The D1 structure shows a clean impulsive rally from the April 7 low (1.15875) through two bullish breaks-of-structure — first at 1.16267 (the March 31 high) on April 9, then at 1.17391 on the same day — establishing the April rally as a confirmed impulsive extension. The subsequent triple-top reaction at 1.18108, 1.18235, and 1.18488 is corrective within that impulse, not a structural reversal. The D1 order block from April 13-16 (1.17529-1.17988) represents the last institutional accumulation zone before the final push — this zone is now being retraced and may attract reactive buyers. The H4 corrective pattern is typical of a distribution-into-resistance phase: price made progressively higher highs at the ceiling while each rejection was sharper than the last, culminating in the April 17 spike-and-close reversal. H4 has since broken the consolidation base (1.17666), confirming a short-term shift. Current H4 is probing the weekly support at 1.17246-1.17391. A hold here, evidenced by a bullish H4 close back above 1.17391, would establish a new higher low and restore the H4 bullish sequence.

Session Map

Monday is characteristically the lowest-conviction day of the week for EURUSD, averaging a 70-pip daily range against the 85-100 pip recent ADR. The Asian session (through 09:00 local) is expected to grind in a tight range around the 1.17246-1.17391 zone with thin institutional participation. The London open window (09:00-11:00 local EET) is the primary directional catalyst — the typical pattern involves a sweep of the Asian high or low in the first 30-60 minutes before committing to the day's direction. Given that price opens directly on weekly support, the most probable Monday sequence is: Asian consolidation at support → London sweep attempt below 1.17246 to clear stops → reversal and reclaim of the support zone → attempt to recover 1.17529-1.17666. Alternatively, if the sweep produces sustained H4 closes below 1.17100, the correction deepens toward 1.16636. The US overlap (14:00-18:00 local) carries no significant scheduled data Monday, reducing the probability of a data-driven expansion. Tuesday's Warsh hearing in US trading hours is the session's primary macro catalyst and likely dominates EUR/USD directional positioning from Tuesday afternoon through end of week.

Consumption & Order Flow

The D1 demand structure that drove the April impulse is partially consumed but not exhausted. The April 9-16 accumulation zone (1.17529-1.17988) saw multi-day institutional absorption before the final push to 1.18488. That zone has now been retraced through, suggesting the buyers at those levels are underwater by 100-200 pips and either holding or stopping out — the supply from these trapped longs adds headwind to recovery attempts through 1.17666-1.17988. The deeper order block at 1.16617-1.16979 (the April 7-8 displacement candles) remains unmitigated and represents the next significant demand zone if the current support fails. The 1.17246-1.17391 support zone itself is where reactive buyers are expected to step in — it has not been tested since the breakout, making it structurally clean rather than compromised by prior failed reactions. The supply picture above is clear: the 1.18235-1.18488 triple-top zone is a well-defined distribution ceiling that will require a catalyst (likely Warsh dovish surprise or PMI beat) to absorb.

Sentiment Overview

The institutional sentiment on EURUSD is bullish at medium confidence. The macro thesis driving the view is structural USD weakness — DXY has broken below 100 following two consecutive soft US inflation prints (CPI April 10, PPI April 14), and the Liberation Day tariff shock triggered a broad dollar diversification that institutional desks have not reversed. Major bank year-end targets remain skewed to 1.19-1.25 (Goldman Sachs and Deutsche Bank at 1.25, Wells Fargo at 1.19 for Q2, ING at 1.21 for Q4). Expert forecasters broadly view the 1.17246-1.17391 zone as the minimum hold for the bullish structure — pullbacks into this zone are characterised as accumulation opportunities for medium-term bulls.

Positioning is supportive from a contrarian standpoint: approximately 65-70% of retail traders remain short EURUSD, a persistent signal that has been on the wrong side of the April rally. Institutional net-long positioning has moderated from its recent extremes after the short-squeeze phase, which reduces the velocity of any continuation but does not negate the directional thesis. Options markets continue to show elevated call skew in the 1.18-1.20 range.

The key risks that could override the technical setup this week: (1) Warsh confirmation hearing — a hawkish or Fed-independent Warsh signals USD structural support and would pressure EURUSD toward 1.16636; (2) Flash PMI miss for the Eurozone Thursday — weak German manufacturing data would undermine the EUR fundamental bid; (3) US-Iran ceasefire breakdown — an oil spike would revive ECB inflation concerns and trigger USD safe-haven flows; (4) failure of the 1.17246-1.17391 support on sustained H4 closes, which would open a deeper correction toward 1.16636 and challenge the W1 uptrend narrative ahead of next week's FOMC and ECB.

Instrument Characteristics

EURUSD is currently in an elevated volatility regime, with recent daily ranges running 85-100 pips against the longer-term average of 64-75 pips. This elevation reflects the heightened macro uncertainty around the tariff cycle, Fed independence concerns, and geopolitical risk from the Iran situation. Monday's typical range is the week's smallest (averaging 70 pips), consistent with slow institutional participation at the week open — the session configuration this morning should be treated as a positioning day rather than a trend day.

The primary directional driver for EURUSD remains the Fed-ECB rate differential. The current EUR-positive thesis is fed by the compression of that differential: the Fed is cutting while the ECB is on hold with a residual probability (26%) of a hike priced into the April 30 meeting. Any shift in this narrative — particularly from the Warsh hearing — is the single largest near-term risk. The DXY inverse relationship (-0.95 correlation) means DXY price action is the most efficient real-time overlay for EURUSD intraday direction; confirmation from GBPUSD (+0.85) and Gold (+0.70) adds conviction to directional reads.

Behaviorally, the current price zone is a known London open sweep target. The stops below 1.17246 (from April breakout buyers) are a liquidity pool that London desks are aware of. The most cautious entry approach for today is to wait for the sweep and recovery confirmation rather than the support hold alone.

What to Watch — Invalidation

1. H4 close below 1.17100 — breaks the W1 support zone conclusively and opens the 1.16636-1.16771 demand area; the reactive long thesis is abandoned on this signal.
2. London open fails to reclaim 1.17391 after any sweep — if price sweeps below 1.17246 and then cannot recover above 1.17391 on an H4 close, the correction is likely extending rather than reversing; stand aside until the picture clarifies.
3. Warsh hearing hawkish surprise (Tuesday) — any testimony language suggesting Fed rate hikes, USD stability as a policy objective, or friction with the current cutting path would structurally bid USD and invalidate the near-term long setup; EUR would be expected to correct toward 1.16636.
4. Eurozone Flash PMI miss Thursday — Composite PMI below 50 for Germany or the Eurozone would materially weaken the EUR fundamental pillar and suspend the continuation case until the ECB meeting April 30.