On Friday, the EUR/USD pair reversed in favor of the U.S. dollar and declined toward the 76.4% Fibonacci retracement level at 1.1514. A rebound from this level today would allow traders to expect a reversal in favor of the euro and some growth toward the 61.8% retracement level at 1.1578. Consolidation below 1.1514 will increase the likelihood of a further decline toward the next Fibonacci level of 100.0% at 1.1409.

The wave structure on the hourly chart remains straightforward at this point. The latest completed upward wave broke above the previous peak, while the latest downward wave broke below the previous low. Therefore, the trend has once again shifted to bearish. Bulls may launch a new offensive only if Iran and the United States sign an interim agreement, stop violating the ceasefire terms, and the Strait of Hormuz remains open. Without these conditions, further appreciation of the euro will be extremely difficult.

On Friday, traders received the data they had been waiting for since the beginning of the week. Throughout the week, a considerable amount of economic information was released in the United States, and nearly all reports showed positive dynamics. However, the market reacted rather cautiously, preferring to wait for the most important releases. On Friday, it became known that the U.S. unemployment rate remained unchanged in May, while Nonfarm Payrolls exceeded traders' expectations by 87,000. In addition, the April reading was revised upward. As a result, a single report was enough for bears to become active after several weeks of inactivity and begin selling aggressively. It should be recalled that the dollar currently has one undeniable advantage — geopolitics. No significant news emerged from the Middle East over the weekend. The opposing sides continued to exchange attacks as usual, while making no progress toward a ceasefire agreement. Since the chances of reaching a peace settlement remain extremely low, the market is unwilling to move too far away from the dollar. Strong U.S. economic data is also adding confidence to the bears.

On the 4-hour chart, the pair rebounded from the 38.2% Fibonacci retracement level at 1.1667 and resumed its decline within the downward trend channel. Consolidation below the 23.6% Fibonacci level at 1.1569 suggests a continuation of the decline toward the next retracement level of 0.0% at 1.1411. Bulls are unlikely to regain control before a breakout above the channel. No emerging divergences are currently observed on any indicator.

Commitments of Traders (COT) Report:

During the latest reporting week, professional traders opened 12,387 Long positions and closed 7,053 Short positions. Over seven weeks in February and March, the bulls' overall advantage disappeared due to the war in Iran, while over the past ten weeks the situation has stabilized amid the suspension of hostilities in the Middle East. The total number of Long positions held by non-commercial traders currently stands at 235,000, while Short positions amount to 186,000. The gap is once again widening in favor of the bulls.

Overall, large market participants continue to maintain a strong long-term interest in the euro. Naturally, various global developments, which have been abundant in recent years, continue to influence investor sentiment. At present, the market's attention remains focused on the Middle East, where the conflict has merely been paused rather than resolved. Therefore, in the near term, the trajectories of the euro and the dollar will depend less on Federal Reserve or European Central Bank monetary policy and economic data, and more on developments in Iran.

News Calendar for the United States and the Eurozone:

The economic calendar for June 8 contains no significant events. Therefore, the impact of the economic backdrop on market sentiment on Monday is expected to be absent.

EUR/USD Forecast and Trading Tips:

Short positions may be considered today if the pair closes below 1.1514 on the hourly chart, with a target at 1.1409. Long positions may be considered on a rebound from 1.1514, with targets at 1.1578 and 1.1630.

Fibonacci grids are plotted from 1.1409 to 1.1850 on the hourly chart and from 1.2081 to 1.1411 on the 4-hour chart.