Technical Analysis:
EUR/USD initially surged during Wednesday's European trading hours, touching a three-day high at 1.12655, driven by lower U.S. Treasury yields and broad-based dollar weakness. Despite this positive intraday momentum, the pair quickly reversed course upon testing critical resistance at the 1.1265/70 region—a former support area now acting as strong resistance. Sellers rapidly stepped in, causing the pair to relinquish most of its gains and highlighting the strength of bearish conviction around this key technical level. Heading into New York trading, EUR/USD hovered near 1.1225, preserving modest gains of approximately +0.33%, but clearly losing bullish traction.

The technical outlook for EUR/USD now appears increasingly mixed and potentially bearish, as evidenced by Wednesday's candlestick formation featuring a pronounced long upper wick. This indicates significant selling pressure at higher levels and suggests limited upside potential unless bulls decisively break above the important 1.1270 resistance. Momentum indicators further underscore this cautious outlook; notably, the monthly RSI continues to trend downward, implying diminished medium-term bullish conviction. Immediate downside support lies at Wednesday’s intraday low at 1.1181, while a break below this level would bring stronger support near recent lows at 1.1150 clearly into focus.

From a fundamental perspective, traders remain highly sensitive to incoming comments from Federal Reserve Vice Chair Philip Jefferson on the U.S. economic outlook. Hawkish statements emphasizing economic resilience or implying prolonged elevated interest rates would likely support renewed dollar strength, weighing on EUR/USD. On the other hand, dovish commentary or expressions of economic caution might reinvigorate euro bulls, sparking another push toward and potentially beyond the 1.1270 resistance. Moreover, euro sentiment could receive additional fundamental support if Eurozone GDP or PMI data surprises positively in the upcoming releases, enhancing expectations of a higher ECB terminal rate, currently projected at approximately 1.75%, and providing bullish fuel for another attempt to sustainably breach resistance at 1.1270.