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January 16, 2026

EUR/USD Slides to Year-to-Date Low After Strong US Jobs Data; 1.1582 in Focus

Market snapshot: USD strength drags EUR/USD to YTD low

EUR/USD traded to a year-to-date low around 1.1593 following US initial jobless claims that came in below estimates, reinforcing underlying USD strength piece. The pair briefly cleared the 1.1600 level before a modest recovery, but short-term momentum remains bearish — the 14-period RSI is below 50 and price action is testing the 200-day simple moving average at 1.1582.

Macro drivers and near-term catalysts

Key drivers for the move include the softer-than-expected US labour data, notably the jobless claims report, which increases the odds of a resilient Fed stance and supports the dollar. Market participants should also monitor any fresh US economic releases or Fed commentary that could further entrench USD strength — see the Fed odds update for context. Conversely, surprisingly strong Eurozone data or a dovish tilt from the Fed would be the principal risk to the current short bias.

What to watch

  • US data and Fed speak: hawkish commentary could accelerate dollar gains.
  • Eurozone prints (PMIs, CPI): upside surprises may trigger a rapid EUR rebound.
  • Technical confirmation: daily close mechanics around 1.1600 and the 200-day SMA at 1.1582.

Technical outlook: levels, momentum and trade ideas

Technically, the market is showing short-term bearish structure. Important reference points and scenarios to consider:

Key levels

  • Immediate support: 1.1600 (psychological), 200-day SMA at 1.1582.
  • Downside targets if 1.1582 breaks: 1.1500 and 1.1391.
  • Upside resistance zone: 1.1700–1.1800; a sustained break above 1.1700 would flip the bias toward 1.1750–1.1800.

High-conviction trade idea (short-bias)

Consider short EUR/USD on a decisive break and daily close below 1.1600, with initial targets at the 200-day SMA (1.1582) and a secondary target at 1.1500. Use a disciplined stop-loss — for example, above 1.1640 — and size positions to limit downside risk. The strategy aligns with the current bearish momentum indicated by the RSI and recent price action.

Alternative scenario (bias flip)

If price sustains a break above 1.1700 and shows follow-through, consider tactical long exposure targeting 1.1750–1.1800. In that case, a stop under the breakout level (e.g., below 1.1680) helps manage risk until the bias confirms.

Risk management and trade execution

Volatility can spike around data and central-bank commentary, so traders should size positions carefully and avoid chasing moves without confirmation. Use clear stop-loss levels, monitor correlations (e.g., EUR/JPY) for cross-market signals, and be prepared to step back if the market environment shifts rapidly.

Using automated tools to manage trades

Automated trading solutions can help implement disciplined entries, exits and risk controls — particularly around key levels like 1.1600 and 1.1700. Retail traders who want to execute systematic strategies may consider a forex trading bot or the trade assistant to automate orders, scale position sizing, and manage stop-loss adjustments. While this piece focuses on forex, many traders also apply automated approaches in crypto trading where volatility and round‑the‑clock markets demand strict risk management.

Short-term sentiment and final outlook

Market sentiment remains bearish for EUR/USD in the short term (confidence ~80%), driven by USD strength after stronger-than-expected US labour data. The critical pivot is the 200-day SMA at 1.1582: a clean break could open deeper downside to 1.1500 and 1.1391. Alternatively, a sustained break above 1.1700 would invalidate the short bias and likely prompt a move toward the 1.1750–1.1800 resistance band.

Conclusion and next steps

Traders should watch price action around 1.1600 and 1.1582 for confirmation of the next directional leg. Whether you prefer discretionary setups or systematic rule-based entries, consider incorporating automated trading tools to help manage execution and risk. Learn more at PlayOnBit.