EURUSD, Nasdaq Outlook: Double Tops or Rallies Ahead?

Key Events:

Trump Announcement on Tuesday
FOMC Member Insights
AI Sector Developments between the US and China
Flash Manufacturing and Services PMI (Friday)

In early Monday trading, the Nasdaq and EURUSD reached critical resistance levels of 22,205 and 1.05 respectively, as tariff concerns eased, dollar momentum reversed, and AI optimism surged- even with the US market on holiday.

With ongoing Trump policy risks, the key question remains: are we seeing double tops or are fresh rallies on the horizon for 2025?

Technical Analysis: Quantifying Uncertainties

EURUSD Outlook: 3-Day Time Frame – Log Scale

Source: Trading view

The EURUSD’s 2025 uptrend depends on breaking above the 1.0520 resistance level, which aligns with the midzone of a declining parallel channel established since July 2023. Currently, the RSI hovers below the 50 neutral zone, suggesting a potential rebound from the 1.05 area toward the 1.04 and 1.02 support levels.

However, a clear close above 1.0520, coupled with weakening momentum on the US Dollar index, could extend gains toward the channel’s upper end, with resistance levels at 1.0620, 1.07, and 1.0850.

Nasdaq Outlook: 3-Day Time Frame – Log Scale

Source: Trading view

Following a series of extended wicks near the 20,800-support zone – which reflected an un-sustained low and a momentum recharge for further highs – Nasdaq hit record highs early Monday at 22,205. With the US market closed for President’s Day, volatility and liquidity may remain limited today. Potential volatility risks from the economic calendar and Trump’s announcements set up two scenarios:

Bullish Scenario: a decisive close above 22,200 can extend Nasdaq’s rally toward the 22,800 zone

Bearish Scenario: failing to close above 22,200 might result in a double-top formation, extending losses towards key support levels between 21,700, 21,200, and 20,800

Written by Razan Hilal, CMT

Follow on X: @Rh_waves

You tube: Commodities and Forex Trading with Razan Hilal, CMT

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