EUR/USD Forecast: Dollar Rally Eyes 98.20 Breakout Ahead of CPI, Puts Euro Under Pressure

Jasper Osita - Market Analyst

2025-07-15 15:10:02

EUR/USD pulls back as DXY confirms bullish continuation near 98 level after Fair Value Gap support bounce.
All eyes on U.S. CPI hotter inflation could trigger a decisive EUR/USD breakdown toward 1.1580–1.1500.
Technical Forecast (EUR/USD) - 1.1600 remains vulnerable; 1.1550–1.1500 downside opens if DXY breaches 98.201 with momentum.

Dollar Bounce from Bullish Fair Value Gap Confirms Upside Structure

The U.S. Dollar has materialized its bullish forecast, bouncing decisively off the 97.60–97.80 Bullish Fair Value Gap and extending gains near the 98.201 level.

This move confirms the previous forecast published - US Dollar Forecast: Bullish Continuation Validated as DXY Targets 98.20 Breakout -, signaling a potential continuation toward the 98.50–99.00 levels.

Technical Validation: Price respected the Fair Value Gap (FVG) and surged with momentum, supporting a bullish structural continuation.
Macro Drivers: Risk-off sentiment due to renewed trade tensions (Trump's tariff threats) and higher Treasury yields further supported the dollar.
Institutional Positioning: The bounce shows clear institutional demand at discount levels, confirming the thesis that dollar strength is not a retracement but a resumption.

CPI Report: The Key Volatility Catalyst

The upcoming U.S. CPI data (Tuesday, July 15 @ 8:30 UTC) is expected to trigger sharp volatility in EUR/USD:

🔺 If CPI beats forecast:

DXY is likely to break above 98.201 decisively
EUR/USD could break below 1.1600
Bearish continuation to 1.1550 or lower

🔻 If CPI misses expectations:

DXY rally may stall or retrace back to 97.70–97.85
EUR/USD could rebound toward 1.1700–1.1740
Opens short-term opportunity for EUR strength

Technical Outlook: EUR/USD Poised for Breakdown After Range Consolidation

**Previous Analysis:** **Bitcoin Breaks Out, Gold Eyes $3,400, Nasdaq Powers Up, USD up next? – What’s Next for this week?**

EUR/USD is respecting a bearish continuation structure, trading within a tight consolidation zone just below the 50% of the range or the equilibrium level. With U.S. dollar gaining traction, Euro struggles to regain strength.

Bullish Scenario: Reclaim of 1.1715 Resistance

If U.S. CPI surprises to the downside and weakens the dollar:

EUR/USD must reclaim and close above 1.1717, invalidating the current distribution range.
This shift would signal demand stepping in and could trigger a squeeze toward:
- 1.1750 (minor resistance)

Invalidation: Daily close back within the range below 1.1717 would invalidate bullish outlook.

Bearish Scenario: Breakdown Through 1.1641 Support

If CPI data supports USD strength and DXY breaks above 98.201:

A clean break and close below 1.1641 confirms the range breakdown.
Momentum could accelerate toward:
- 1.1580 – swing low target from June
- 1.1500 – psychological level and liquidity pool

Confirmation: Lower highs continue to form beneath 1.1717, and clean sweep or break of 1.1641 with increased volume would validate this bearish move.

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This content may have been written by a third party. ACY makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplies by any third-party. This content is information only, and does not constitute financial, investment or other advice on which you can rely.

Autor

Jasper has been in the markets since 2019 trading currencies, indices and commodities like Gold. His approach in the market is heavily accompanied by technical analysis and of course, supported by fundamentals. He has a background in trading proprietary firms and has been teaching students how to navigate themselves in the markets from basic to advance concepts.

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EUR/USD Forecast: Dollar Rally Eyes 98.20 Breakout Ahead of CPI, Puts Euro Under Pressure

Dollar Bounce from Bullish Fair Value Gap Confirms Upside Structure

CPI Report: The Key Volatility Catalyst

🔺 If CPI beats forecast:

🔻 If CPI misses expectations:

Technical Outlook: EUR/USD Poised for Breakdown After Range Consolidation

Bullish Scenario: Reclaim of 1.1715 Resistance

Bearish Scenario: Breakdown Through 1.1641 Support

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