EUR/USD & GBP/USD Scenarios to Watch: Technical Outlook Ahead of Core PCE and GDP
ACY Securities - Jasper Osita
- Euro and Pound broke out of multi-week ranges, riding smart money flows and dollar (DXY) weakness as both pairs push into premium levels.
- Ceasefire talks and weak U.S. data fueled the rally, but upcoming high-impact U.S. releases could shift momentum.
- As long as 1.1600 (EUR/USD) and 1.3650 (GBP/USD) hold, bulls remain in control, but any strong dollar print may flip the bias.
Euro & Pound on Parabolic
Both the euro and pound have aggressively broken out of multi-day consolidation ranges, driven by a combination of dollar softness and bullish technical confirmations. This forecast was outlined previously in my weekly gameplan: Forex, Indices, Gold Weekly Gameplan: Technical Analysis & Price Action Outlook. Make sure to check this out for reference.
- EUR/USD cleared a key high after the Monday candle broke through the range and reclaiming imbalance between 1.15075-1.15139 Fair Value Gap.
- GBP/USD also created a strong momentum, mirroring the Euro move, since they are high correlated, after sweeping the lows on Monday.
In both cases, the market has moved from accumulation to expansion, signaling a potential shift to trend continuation phases. These moves follow textbook Smart Money Concepts (SMC): liquidity sweep → FVG retest → bullish continuation. With the dollar weakening across the board, both pairs are now in a parabolic move with potential new highs in sight.
Geopolitical Relief Boosts Risk Sentiment
- A tentative ceasefire between Israel and Iran remains intact as of June 26, although initial violations have been reported. Markets have interpreted the calm as a positive, with risk assets rallying and the USD losing some safe-haven demand.
- President Trump confirmed U.S.–Iran talks are expected next week, which may ease investor concern over prolonged geopolitical instability.
Market Reaction
The weaker data and the de-escalation in the Middle East have combined to pull Treasury yields lower and support risk-on flows. EUR/USD and GBP/USD responded accordingly, with breakouts from range highs confirming trend acceleration. Traders are now pricing in a greater chance of Fed rate cuts this year, further weighing on the greenback.
Technical Outlook
EUR/USD Bullish Scenario
Euro is still on a strong parabolic to the upside with a new range being broken for a bullish continuation after taking out the 1.16314 level.
This momentum left 2 bullish imbalances that could be an entry level for upside continuation.
As long as we stay above the range and the 2 bullish Fair Value Gaps remain intact we could see strength to be intact.
Dollar weakness would also translate to more upside on Euro.
- 1st Layer FVG - 1.16359-1.16533 + 1.1640 Support Level
- 2nd Layer FVG - 1.16135-1.16270 + 61.8%-79% Discount Level
Targets:
- Psych Levels - 1.175-1.180
EUR/USD Bearish Scenario
Upcoming U.S. data releases could temporarily cap Euro momentum if the figures come in stronger-than-expected posing risk for Euro and bolster the dollar.
If the imbalances get invalidated by push thru and closing below, Euro might continue to pullback to a more discounted level to 1.1550 level.
Another risk for Euro is if the immediate low resting at 1.1580 level gets invalidated.
Target/s:
- 1.1550 Level
- 1.1500 Level
GBP/USD Bullish Scenario
Pound has now broken out of the previous consolidation with 1.37488 level in sight. There are still no signs of weakness and we could see new highs on the horizon.
As long as we stay above the range and not closing below the low of the range, we could see strength to remain for new upside.
- 1st Layer FVG - 1.36712-1.36763
- 2nd Layer FVG - 1.36431-1.36513
- 3rd Layer FVG - 1.36216-1.36362 (Last Line of Defense)
Target/s:
- 1.3750 Level
- 1.3800 Level
GBP/USD Bearish Scenario
If price creates a bearish sequence or a series of lower high and lower lows while taking out the FVGs this could pose risk on pound for downside move.
Ultimately, an invalidation of 1.359-1.360 level could pave way for a reversal to the downside move.
Target/s:
- 1.362 Level
- 1.360 Level
- 1.359 Level
Incoming High Impact News
All eyes are on upcoming Red Folder U.S. data that could shake up the dollar narrative and impact both Euro and Pound pairs.
These data points have the potential to either confirm the breakout momentum or completely reverse it. Expect volatility and plan scenarios accordingly.
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