During Wednesday, the EUR/USD pair reversed in favor of the US dollar and began a new downward movement toward the Fibonacci level of 127.2% – 1.1440. A rebound from this level today would favor the euro and a resumption of growth toward the corrective level of 100.0% – 1.1577. A consolidation below the 1.1440 level would allow traders to expect further decline toward the levels of 1.1374 and 1.1282.

The wave situation on the hourly chart remains clear. The last completed downward wave broke the low of the previous wave, while the last upward wave failed to break the previous peak. Thus, the trend currently remains "bearish." Actions by Donald Trump in the Middle East have triggered large-scale military operations in the region involving dozens of countries, which have allowed—and continue to allow—the dollar to strengthen as a "safe-haven" currency.

On Wednesday, the FOMC summarized the results of its March meeting. Traders learned of a sharp shift in sentiment by the US regulator in the direction opposite to further monetary easing. Due to the sharp rise in oil and gas prices, the Fed expects inflation to increase in 2026, which prevents expectations of a near-term interest rate cut. At the press conference, Jerome Powell made it clear that the regulator is trying to adhere to both of its mandates: price stability and full employment. However, the decision to refrain from cutting rates indicates that inflation is the priority for the FOMC. Yesterday, traders received an answer to the question of whether the US central bank would stimulate the labor market and the economy. The answer: no. Inflation may accelerate globally in the coming months, and the US is no exception. Now it is important to understand to what levels the consumer price index will rise and which central banks may have to consider not lowering or maintaining rates, but raising them. In a few hours, the results of the ECB meeting will be announced, which may finally bring some relief to the bulls. The Fed has taken a more "hawkish" stance, and the ECB may follow suit. For the Eurozone, the problem of high energy prices is even more acute than for the US, since most energy resources are imported.

On the 4-hour chart, the pair reversed in favor of the euro and consolidated above the Fibonacci level of 100.0% – 1.1474. Thus, the upward movement may continue toward the next corrective level of 76.4% – 1.1617. A consolidation below 1.1474 would increase the likelihood of further decline toward the next Fibonacci level of 127.2% – 1.1310. The descending trend channel continues to indicate full dominance of the bears. No emerging divergences are observed on any indicator.

Commitments of Traders (COT) report:

During the last reporting week, professional traders closed 28,900 long positions and opened 2,454 short positions. The sentiment of the "Non-commercial" group remains "bullish" thanks to Donald Trump and his policies, but in recent weeks we have seen an active reduction in long positions. The total number of long contracts held by speculators now stands at 266,000, while short positions total 160,000. The bulls still hold a significant advantage, but they are rapidly losing it.

Overall, in the long term, large players continue to view the euro with considerable respect. Of course, various global events—of which there has been no shortage in recent years—affect investors in different ways. At present, the market's focus is on the Middle East, where the war continues to escalate and expand geographically. Thus, in the near term, the euro and dollar exchange rate will depend not on Fed monetary policy or economic data, but on the war in Iran. And for now, the dollar is benefiting the most from this situation.

News calendar for the US and the Eurozone:

• US – Initial jobless claims (12:30 UTC)
• Eurozone – ECB interest rate decision (13:15 UTC)
• Eurozone – Press conference by Christine Lagarde (13:45 UTC)
• US – New home sales (14:00 UTC)

On March 19, the economic calendar contains four entries, two of which are notable. The impact of the news background on market sentiment on Thursday may be present, but is unlikely to be strong.

EUR/USD forecast and trading advice:

Selling the pair was possible after a close below 1.1577 with a target of 1.1440. The target has been reached. New sell positions will be possible after a consolidation below 1.1440 with targets at 1.1374 and 1.1282. Buy positions can be opened if the price rebounds from the 1.1440 level with a target of 1.1577.

Fibonacci levels are constructed from 1.1577–1.2082 on the hourly chart and from 1.1474–1.2082 on the 4-hour chart.