Dollar Strength Keeps Pressure on EUR/USD Ahead of Busy Week

The EUR/USD pair continues to face pressure from investors favoring the U.S. dollar ahead of upcoming macroeconomic releases. The European Central Bank (ECB) kept interest rates unchanged in June, adopting a data-dependent approach. Meanwhile, markets are assessing the possibility of the Federal Reserve keeping monetary policy restrictive for longer if inflation remains elevated.

Higher Treasury yields and resilient U.S. economic data continue to underpin the dollar's strength. Geopolitical tensions in the Middle East also remain an important driver, with elevated energy prices increasing inflation risks for the euro area while supporting safe haven demand for the U.S. dollar.

The interest rate differential continues to favor the greenback, limiting the euro's recovery attempts. The technical picture suggests that sellers are in control, with EUR/USD trading below its key medium-term moving averages and every rebound towards 1.1400-1.1430 attracting fresh selling interest.

The pair is approaching a major support zone around 1.1330, which has repeatedly attracted buyers in recent weeks. However, the intensified downside pressure increases the probability of a decisive break below this level, exposing the pair to a deeper decline towards 1.1300 and potentially 1.1270.