Today, the EUR/USD pair is attempting to regain positive momentum, approaching the psychological level of 1.600 and price levels last seen in 2021.

Traders are eagerly awaiting the important political decision from the FOMC, scheduled for Wednesday. This event will be a key factor in determining the future direction of the U.S. dollar.

Investors anticipate that the Federal Reserve may resume its rate-cutting cycle as early as September. Such a scenario could reduce the attractiveness of the U.S. dollar and limit its upside, especially if the market expects a more dovish policy stance.

At the same time, a hawkish signal from the European Central Bank indicating that the end of its rate-cutting cycle is near creates a positive backdrop for the euro. This could support the EUR/USD pair and help strengthen the European currency against the dollar.

From a technical perspective, the upward movement observed over the past several months indicates a solid short-term bullish trend, favoring the bulls. Moreover, oscillators on the daily chart remain in positive territory, suggesting that the path of least resistance for the EUR/USD pair is to the upside. Therefore, any corrective pullback can be viewed as a buying opportunity.

Meanwhile, the psychological level of 1.1500 is shielding the pair from immediate downside, followed by support at 1.1448. Next comes the 1.1450 level and the round number 1.400. A convincing break below this range would be a turning point, dragging the EUR/USD pair down toward the support zone of 1.1370–1.1340.

On the other hand, the 1.1585 level, followed by the key 1.1600 level and the multi-year high near 1.1630 reached last Thursday, present resistance. A breakout above the 1.1655–1.1660 level will be viewed as a new trigger for bulls, allowing the EUR/USD pair to aim for the next round level of 1.1700.