EUR/USD stays above 1.1700 as strong buying momentum builds, trading around 1.1720 during Asian hours on Monday. Technical analysis suggests a positive outlook with the pair slightly above an upward channel. The 14-day Relative Strength Index (RSI) is at 61.63, indicating solid momentum and upward pressure. The nine-day Exponential Moving Average (EMA) is above the 50-day EMA, confirming a bullish stance. EUR/USD may aim for 1.1800, close to the two-month high of 1.1804. If it breaks above this level, the next target could be 1.1860, and then towards 1.1918, a level not seen since June 2021.

Recent Price Movements

Immediate support is at the nine-day EMA of 1.1713, which aligns with the lower boundary of the ascending channel at 1.1710. If the price falls below this level, it could weaken short-term momentum, testing the 50-day EMA at 1.1648 and the recent low of 1.1589 from December 1. Today, the Euro rose by 0.08% against the US Dollar. It also gained against other major currencies: 0.18% against GBP, 0.22% against JPY, and 0.23% against AUD. The following table shows the Euro’s percentage change against these currencies. This analysis includes insights from an AI tool. We recall the significant bullish momentum when the pair crossed 1.1700 years ago, eventually pushing it above 1.1900 in early 2024. Now, on December 22, 2025, the pair trades around 1.2250, but momentum has slowed as the new year approaches. This pause signals a need for a new catalyst to set the next major direction.

Options Strategy Considerations

In light of recent lower US inflation, with November’s Consumer Price Index (CPI) at 2.8%, a dovish shift from the Federal Reserve seems more likely. Traders might think about buying call options with strike prices over 1.2350 to take advantage of a possible breakout. This strategy offers a defined-risk way to prepare for a potential year-end rally if the dollar weakens further. Conversely, the European Central Bank has suggested its rate hike cycle is completed, with Eurozone inflation now at 2.5%. This places a limit on the Euro’s strength, indicating a range-bound market or a pullback might occur in the upcoming quiet holiday weeks. Buying put options with a strike near 1.2100 could be a helpful way to safeguard against a failure to rise further. Currently, we see much lower implied volatility compared to the sharp central bank tightening phases experienced in 2022 and 2023. During that time, EUR/USD fell below parity due to the energy crisis and aggressive Fed actions, leading to significant price swings. The current calmer environment results in relatively cheaper option premiums, providing an opportunity to position for the next major move in early 2026. Create your live VT Markets account and start trading now.

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