During Monday, the EUR/USD pair reversed in favor of the European currency near the 127.2% corrective level at 1.1440 and began to rise toward the Fibonacci level of 100.0% at 1.1577. A rebound from this level will favor the US dollar and lead to some decline toward 1.1440. A consolidation above 1.1577 will support further growth toward the next corrective level of 76.4% at 1.1696.

The wave situation on the hourly chart remains clear. The last completed upward wave exceeded the previous peak by only a few points, while the new downward wave broke the previous low. Thus, the trend currently remains bearish. Donald Trump's actions in the Middle East have triggered large-scale military activity in the region involving around a dozen countries, which has allowed and continues to allow the US dollar to strengthen as a safe-haven currency.

On Monday, economic reports again did not matter to traders, and the slight decline of the dollar along with the retreat of bearish pressure may have been linked to a modest easing of tensions surrounding the war in the Middle East. According to Donald Trump, more and more oil tankers are passing through the Strait of Hormuz, and it is expected to be fully unblocked in the future. At present, it is not reliably known whose tankers are passing freely, as Iran continues to export oil to China, meaning these could be Chinese tankers. At the same time, Trump is demanding military assistance from European countries to unblock the strait. In simple terms, the US president wants European nations to send their naval vessels to the Persian Gulf to escort oil tankers. No European country has agreed to this proposal. It is clear that if military ships escort tankers, both would become targets for Iranian drones and missiles. Therefore, EU countries find it easier to seek alternative solutions to the oil and gas crisis rather than becoming involved in a war against Iran. If even one military vessel were attacked, it would require a military response. It is likely that this is exactly the scenario Donald Trump wants, so that the United States does not act alone in the Middle East. However, as noted, none of the countries accepted this "offer."

On the 4-hour chart, the pair reversed in favor of the euro and consolidated above the Fibonacci 100.0% level at 1.1474. Therefore, the upward movement may continue toward the next corrective level of 76.4% at 1.1617. A move below 1.1474 will increase the likelihood of further decline toward the next Fibonacci level of 127.2% at 1.1310. The downward trend channel continues to indicate full dominance by sellers. No emerging divergences are observed on any indicators.

Commitments of Traders (COT) report:

During the last reporting week, professional traders closed 28,900 long positions and opened 2,454 short positions. The sentiment of the "Non-commercial" group remains bullish due to Donald Trump and his policies, but in recent weeks there has been a notable reduction in long positions. The total number of long positions held by speculators now stands at 266,000, while short positions total 160,000. The bulls still maintain a significant advantage, but it is rapidly diminishing.

Overall, in the long term, major players continue to view the euro with considerable confidence. At the same time, global developments—of which there has been no shortage in recent years—continue to influence investor behavior. In particular, market attention is currently focused on the Middle East, where the war continues to escalate and expand geographically. Thus, in the near term, the euro and dollar exchange rate will depend not on Federal Reserve monetary policy or economic data, but on the war in Iran. For now, the dollar is benefiting the most from this situation.

Economic calendar for the US and the Eurozone:

• Germany – Trade Balance (07:00 UTC)
• US – ADP Employment Report (weekly) (12:15 UTC)
• US – Existing Home Sales (14:00 UTC)

On March 17, the economic calendar includes three relatively minor entries, but the market continues to ignore most reports anyway. The impact of the news background on market sentiment on Tuesday may again be very weak.

EUR/USD forecast and trading tips:

Selling opportunities were available after a close below 1.1577 with a target of 1.1440. This target has been reached. New selling opportunities may arise from a rebound at 1.1577 with a target of 1.1440, or after a close below 1.1440 with targets at 1.1374 and 1.1282. Buy positions could be opened from a rebound at 1.1440 with a target of 1.1577, and these trades can still be held today.

Fibonacci levels are drawn from 1.1577–1.2082 on the hourly chart and from 1.1474–1.2082 on the 4-hour chart.