On Thursday, the EUR/USD currency pair traded relatively calmly, and in general, has been trading within a limited price range for the past three weeks, as can be clearly seen on the 4-hour timeframe. As we observe, bears are not rushing to attack; there is no reason or ground for that. At the same time, traders are also not in a hurry to continue buying the pair, as the truce between Iran and the US could shatter at any moment, like a fragile vase. Thus, the market has taken a wait-and-see position.

Meanwhile, Donald Trump is laying the groundwork for a new order in the world. Many are now waiting for the resolution of the conflict in the Middle East, hoping to see lower energy prices and finally exhale. However, in our view, Trump's ambitions to reshape the world won't end with the conflict with Iran. First, it's important to remember that Trump is very dissatisfied with Cuba and practically all Latin American countries. Second, the US president is not happy with the European Union. Therefore, the next conflict will arise after Iran. With Europe, it may lead to a new trade war, while with Latin American countries, it could result in a full-scale war or an operation similar to Venezuela's. Thus, as long as Trump remains the president of the United States, relaxation is not in the cards.

Just last week, Trump suddenly remembered the trade war and was surprised to learn that the trade deal with the EU had not yet been ratified by the European Parliament, despite nine months having passed. Brussels can be understood. Trump's tariffs were ruled illegal by the US Supreme Court. The White House leader immediately introduced new tariffs to replace the old ones, but some countries have already agreed to trade agreements with the US based on the initial version of the tariffs. Therefore, the European Union does not understand on what basis it should ratify an agreement founded on Washington's illegal extortion.

Also, last summer, one variant of tariffs was discussed, only for it to be revealed that Trump had proposed a new variant (since the old ones were canceled by the court). This new tariff package can only be active for a maximum of 150 days. By the way, these 150 days are expiring very soon, and Congressional approval is required for an extension. In general, to put it very simply, Brussels is in no hurry to ratify the agreement, while Trump once again threatens trade sanctions. This time, it's on European cars. Currently, a 15% tariff is in effect in the US; if Brussels doesn't hurry, it will increase to 25%. We should only remind ourselves that all tariffs will again be paid by Americans, not the European Union. For them, European cars could become even more expensive. And those $150 billion that were illegally collected last year, the White House has no intention of returning to anyone. A new round of trade war with the European Union equals one more factor contributing to the dollar's decline in 2026.

The average volatility of the EUR/USD currency pair over the last five trading days as of May 8 is 64 pips and is categorized as "average." We expect the pair to trade between 1.1698 and 1.1826 on Friday. The upper linear regression channel has flattened, indicating a change in trend to the upside. In fact, the upward trend of 2025 may have already resumed. The CCI indicator has entered overbought territory and formed two "bearish" divergences, signaling the start of a downward correction.

Nearest Support Levels:

S1 – 1.1719

S2 – 1.1658

S3 – 1.1597

Nearest Resistance Levels:

R1 – 1.1780

R2 – 1.1841

R3 – 1.1902

Trading Recommendations:

The EUR/USD pair maintains an upward trend amid diminishing geopolitical influence on market sentiment and declining geopolitical tensions. The global fundamental backdrop for the dollar remains extremely negative, so in the long term, we still expect the pair to rise. If the price is below the moving average, short positions can be considered with targets at 1.1698 and 1.1658 based on technical analysis. Above the moving average line, long positions are relevant with targets at 1.1826 and 1.1841. The market continues to drift away from geopolitical factors, and the dollar is losing its only growth driver.

Explanations for the Illustrations:

• Linear regression channels help determine the current trend. If both are pointing in the same direction, it indicates a strong trend.
• The moving average line (settings 20,0, smoothed) determines the short-term trend and the direction in which trading should be conducted.
• Murray levels – target levels for movements and corrections.
• Volatility levels (red lines) – indicate the probable price channel in which the pair will spend the upcoming day, based on current volatility metrics.
• CCI Indicator – its entry into the overbought (above +250) or oversold (below -250) areas signals that a trend reversal is approaching in the opposite direction.