• EUR/USD remains capped below 1.1590 after bouncing from 1.1500 lows.
• Optimism about a US-Iran peace deal and a hawkish ECB are supporting the pair.
• Euro bulls struggle to return above the bottom of late-May's trading range.

The Euro (EUR) has given away previous daily gains against the US Dollar (USD) and is trading practically flat, at 1.1575 at the time of writing. The EUR/USD pair has bounced from two-month lows at 1.1500 but is failing to find follow-through above the floor of the previous three weeks' trading range, at the 1.1580-1.1590 area

A moderate risk appetite keeps holding the Euro above previous lows, with market sentiment buoyed by news reporting advances in the US-Iran peace process. US President Donald Trump said on Thursday that the final deal could be signed in the coming days, although Tehran has been more cautious, warning that the final decision has not been taken yet.

The ECB delivered a rather hawkish hike

On Thursday, the European Central Bank (ECB) hiked interest rates by 0.25% for the first time in nearly three years and revised its inflation forecasts for the next few years. This has been seen as a sign that further tightening is on the table and has provided additional support to the Euro.

In the US, Producer Price Index (PPI) figures were mixed. Headline inflation accelerated to a 6.5% yearly rate, its fastest level in more than three years, while the core PPI remained steady at 4.9% against expectations. Later on the day, the US Michigan Consumer Sentiment Index is expected to show that the high cost of living is keeping consumers’ morale near historic lows, and is highly unlikely to provide any significant support to the USD

Technical Analysis: Bulls remain capped at a previous support area

EUR/USD trades at 1.1574, holding a modest bullish bias in the near-term, yet with the late May-early April trading range capping gains. Momentum indicators in the 4-hour chart remain moderately bullish with the Relative Strength Index (RSI) hovering in the mid-50s and Moving Average Convergence Divergence (MACD) at marginally positive levels..

Bulls need to break and confirm above the mentioned resistance at the 1.1580-1.1590 area, which held bears several times over the previous three weeks. If those levels are breached, the focus will shift to the June 4 and 5 highs, near 1.1645, and the late-May high, at 1.1685.

Pullbacks have remained contained above 1.1555 so far on Friday, keeping two-month lows in the 1.1500 area at a relatively safe distance. An unlikely move below that level brings the March 19 and 30 lows, around 1.1445, into focus.

(The technical analysis of this story was written with the help of an AI tool.)