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EURUSD Bears Return as Rising Oil Fuels Fed Hawkish BetsHey Traders,
In today's trading session, we are monitoring EURUSD for a potential selling opportunity around the 1.16800 zone. EURUSD remains in a broader downtrend and is currently undergoing a corrective move, with price approaching the 1.16800 support and resistance area, which now represents an important resistance zone.
From a fundamental perspective, the continued strength in **crude oil** is becoming increasingly important for FX markets. With Middle East tensions keeping oil elevated and WTI potentially moving toward the $90 area, inflation risks are rising across the global economy.
For the U.S., higher energy prices could make the Federal Reserve more cautious about cutting rates and potentially reinforce expectations for a more hawkish Fed. This creates a supportive environment for the U.S. Dollar through higher rate expectations and Treasury yields.
A stronger USD is naturally a headwind for EURUSD.
If oil continues higher and markets further price out aggressive Fed easing, we could see additional USD strength and renewed selling pressure in EURUSD. This makes rallies toward the 1.16800 resistance zone particularly interesting from a bearish perspective.
As long as price remains below the 1.16800 resistance zone, the bearish structure remains intact, and we anticipate continuation toward lower support levels.
Trade safe,
Joe
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17/08/26 Weekly OutlookLast weeks high: $65,393.94
Last weeks low: $62,539.20
Midpoint: $63,966.57
Last week faded from the $65,393 high down to the $62,539 weekly low on an in-line-CPI sell-the-news event. July CPI landed in-line (3.4% headline), trimming September hike odds to ~38% but offering no breakout fuel.
The low held and BTC is now bouncing, reclaiming the $63,252 (0.25) level and eyeing the $63,966 midpoint.
The low time frame is apathetic and low-volume, perpetual futures activity hit a three-year low so this is chop, not a trend. The bigger picture stays capped at $66,000 as has been the case for BTC since the beginning of June. Without a serious move with conviction above that key level, more of the same is on the horizon.
Bull case: The weekly low held, ETF inflows were the strongest since April ($853M, IBIT-led), whale balances hit a 2026 high, and in-line CPI removed inflation tail risk — enough for a push back toward $65,800 if the midpoint reclaims.
Bear case: Rejection of the Midpoint and a move lower towards weekly low and below. Long-term-holder capitulation, and dead volume favour a fade toward $62,539, then the $57,700 2026 low.
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