EUR/USD pressures 2026 lows as risk aversion fuels US Dollar demand

• The US Dollar and Oil surged as fears of oil supply disruption took their toll on sentiment.
• US President Donald Trump claimed the country is the world's largest oil producer.
• EUR/USD trades near 1.1500 and is biased lower in the near term.

The US Dollar (USD) trades with a firmer tone across the FX board in the American session on Thursday, as persistent concerns about oil supply disruptions undermine the market’s mood. The EUR/USD pair trades in the 1.1520 price zone, not far above the 2026 low at 1.1507.

The focus remains on the Strait of Hormuz closure and the back-and-forth attacks. Despite the United States (US) claiming it will grant passage through the Strait, it is clearly under Iranian control: Several tankers from neighboring countries have been attacked, and different news agencies reported that Iran laid mines in the passage. Even further, the new Iranian Supreme Leader, Mojtaba Khamenei, issued a statement in which he declared that the Strait should remain closed as a tool to pressure the enemy.

 Meanwhile, US President Donald Trump claimed that, given that the US is the largest oil producer in the world, and that when prices go up they “make a lot of money,” somehow dismissing concerns about Brent surpassing $100 per barrel and West Texas Intermediate (WTI) trading above $ 90.

Tensions are likely to maintain the USD on its bullish route, particularly if attacks continue.

 On Friday, market participants will be looking for the US  Personal Consumption Expenditures (PCE) Price Index release. The country will publish January data, after  December figures showed core PCE inflation at 2.9%.

Technical Analysis:

In the 1-hour chart, EUR/USD trades at 1.1523. The near-term bias is bearish as spot holds below the 20-, 100-, and 200-period Simple Moving Averages (SMAs), which all slope lower and cap recovery attempts. The same chart shows that technical indicators remain below their midlines, with modest upward slopes, not enough to confirm a firmer recovery but rather reflecting the pause in the decline.

Initial resistance emerges at the 20-period SMA near 1.1540, followed by the 100-period SMA around 1.1585 and then the 200-period SMA close to 1.1606, where a break would be needed to ease the bearish tone. On the downside, immediate support is located at the 2026 low at 1.1507, with a decisive break opening the path toward the 1.1470 price zone, a strong static support area.

(The technical analysis of this story was written with the help of an AI tool.)