The EUR/USD pair continues its upward movement on expectations of a ceasefire between Iran and the United States, as well as amid a halt in hostilities in the Middle East. Last week, a reaction was seen at bullish imbalance 12, after which the bulls began their offensive. Thus, traders had the opportunity to open long positions, which are currently showing strong profits. The geopolitical backdrop has now become more favorable compared to two weeks ago, which likely explains the sharp improvement in bullish sentiment. However, in my view, a combination of factors played a role. First, the market could not continuously flee from risk by buying the dollar—risk is not a permanent condition, and capital can quickly shift into safe-haven assets. Second, there was a technical buy signal. Third, Donald Trump softened his rhetoric regarding the Middle East conflict. Just this morning, the US president stated that all objectives of the military operation had been achieved, and the war may end soon. The market is also expecting a new round of negotiations between Tehran and Washington in the coming days.

All of the US dollar's growth over the past one and a half to two months has been driven solely by geopolitics. As soon as the US and Iran agreed to a two-week ceasefire, bears immediately retreated, and bulls launched their attack. At present, the ceasefire remains fragile but is holding despite the failure of negotiations in Islamabad. I have repeatedly stated that I do not believe in the end of the bullish trend, despite the break of key trend-forming lows. The movement of the past two months could turn into a bearish trend if geopolitics worsen further—but how much worse can it get? Everything that could go wrong has already happened. Markets often price in the most pessimistic scenario in advance, trying to anticipate the worst possible outcome. Therefore, I believe traders may have already fully priced in the geopolitical conflict in the Middle East.

The chart picture has now become clearer. First, price showed no reaction to imbalance 11 and did not begin a new downward movement—no sell signal was formed. Second, price reacted to imbalance 12, forming a bullish signal within a bullish trend. Third, a new bullish imbalance 13 has formed, which now represents a zone of interest for future long trades and a support area for the euro.

The news background on Wednesday was practically absent, and after seven days of uninterrupted attacks, bulls decided to take a short pause. Just a pause—nothing more. No important news is expected today, so market movements may remain weak until the end of the day. However, this does not matter much for traders. Long positions are already in solid profit, and there are currently no new signals.

There are still plenty of reasons for bulls to stay active in 2026, and even the outbreak of the Middle East conflict has not reduced them. Structurally and globally, Trump's policies—which led to a sharp decline in the dollar last year—have not changed. In the near term, the US currency may still show growth amid risk aversion, but this factor requires continuous escalation in the Middle East, which is unlikely. Just one week of pause—and the euro has already recovered nearly 300 pips. Meanwhile, the dollar lacks other strong supporting factors. I still do not believe in a sustained bearish trend for EUR/USD. The dollar received temporary support, but what will drive bears in the long term?

News calendar for the US and the Eurozone:

• Eurozone – Consumer Price Index (09:00 UTC)
• US – Initial Jobless Claims (12:30 UTC)
• US – Industrial Production (13:15 UTC)

On April 16, the economic calendar contains three entries that are not particularly significant. The impact of the news background on market sentiment on Thursday is expected to be very weak or absent.

EUR/USD forecast and trading advice:

In my view, the pair remains in the process of forming a bullish trend. The news backdrop sharply shifted direction two months ago, but the trend itself cannot be considered canceled or complete. Therefore, bulls may continue their offensive in the near future, provided geopolitics stops dominating 100% of market attention.

Bulls had the opportunity to open long positions based on the signal from imbalance 12 with a target around 1.1670. This target has long been reached, and the upward movement may continue toward the yearly highs. A new imbalance 13 has also formed, which may provide a new bullish signal in the future.

For the euro to rise without obstacles, the Middle East conflict must move toward a stable peace, which is not currently the case. However, bears are not gaining new reasons to attack either. In the near term, I would focus primarily on technical analysis.