EUR/USD Holds Above 1.1350 as Traders Eye Powell and US Retail Data

The EUR/USD pair remains resilient above 1.1350 in Wednesday’s European session, supported by broad weakness in the U.S. Dollar. Ongoing trade tensions between the U.S. and China, combined with stalled EU-U.S. trade discussions, have weighed on dollar sentiment.

Investors are also cautious ahead of Federal Reserve Chair Jerome Powell’s speech, scheduled later today at the Economic Club of Chicago. His remarks on the economic outlook could provide key insights into the Fed’s next move.

From a technical perspective, EUR/USD shows short-term bullish momentum:

• The Relative Strength Index (RSI) on the 4-hour chart remains above 60
• The price trades above the 20-period Simple Moving Average (SMA)
• Momentum indicators point to potential further upside

Key Levels to Watch for EUR/USD

Traders are closely monitoring support and resistance zones that could shape near-term market direction.

Resistance levels include:

• 1.1400 – static resistance and midpoint of the current ascending channel
• 1.1470 – previous resistance area
• 1.1500 – psychological round number

Support levels to monitor:

• 1.1340 – initial static support
• 1.1300 – psychological round level
• 1.1250 – deeper support zone

On Tuesday, EUR/USD slipped temporarily after Bloomberg reported that the European Union expects many of the current U.S. tariffs to remain in place due to stalled trade negotiations. However, the pair regained strength after a Wall Street Journal report indicated that the U.S. may pressure trading partners to cut ties with China, further undermining the dollar.

All Eyes on Powell and Retail Sales

Markets are bracing for fresh U.S. economic data and Fed commentary, both of which could sway the dollar.

The U.S. Census Bureau is set to release Retail Sales data for March, with forecasts pointing to a 1.3% monthly increase. A stronger-than-expected reading may offer a short-term boost to the USD, but the broader reaction could be muted unless supported by Powell’s tone.

Later, Powell’s remarks on monetary policy will be crucial. According to the CME FedWatch Tool, traders are currently pricing in just a 20% chance of a 25 basis-point rate cut in May. If Powell signals a continued hold in interest rates, the U.S. Dollar may regain ground, potentially testing downside levels in EUR/USD.

Conclusion:

EUR/USD is maintaining bullish traction above 1.1350, but key data and Fed signals could shift momentum. A break above 1.1400 may fuel further gains, while Powell’s tone will be decisive for dollar direction in the short term.