EUR/USD Lost the Breakout, but the ECB Story Is Still AliveEUR/USDOANDA:EURUSDEvelyn_ReedEUR/USD pushed through 1.162 earlier in August, ran almost to 1.170, and then gave most of that breakout back. Now price is back at the same area from below. That changes the short-term chart. The interesting part is that the euro’s fundamental backdrop has not weakened nearly as much as price has. ECB officials are still leaning toward another rate hike in September. Minutes from the July meeting showed policymakers already thought further tightening would probably be needed, and recent comments from Isabel Schnabel have been even more explicit. German inflation also ticked higher in August to 2.9%. It was below expectations, but energy prices are keeping the inflation problem alive. So this is not a clean “weak euro” story. The dollar side is complicated too. Kevin Warsh’s Jackson Hole speech pushed Fed hike expectations higher, but the dollar actually softened again on Monday as markets turned their attention to Friday’s U.S. jobs report. Economists are looking for only around 55,000 new jobs. A weak print would make the Fed’s hawkish message harder to maintain. What the chart shows The 1.161–1.162 area has changed character. Price broke above it, failed to hold, and is now testing it from underneath. Unless EUR/USD can reclaim the zone, I would treat it as resistance again. The rising trendline around 1.155–1.156 is the next meaningful test. Below that, the 1.150–1.152 area remains the larger support that has already attracted buyers several times. Primary scenario The near-term structure remains under pressure while price stays below the failed breakout zone. A rejection here followed by a test of the rising trendline would fit the current chart without necessarily breaking the broader recovery. If buyers defend that trendline, the euro still has a chance to rebuild the move. Alternative scenario A clean reclaim of 1.162 would make the latest breakdown look less convincing. That becomes more plausible if U.S. labour data disappoints and Fed hike expectations fall again. What would change the view The cautious interpretation weakens if EUR/USD regains 1.162 and starts holding above it. The broader constructive structure weakens if price loses the rising trendline and then begins accepting below 1.150. What comes next Friday’s U.S. payroll report is the obvious catalyst. The ECB is still talking about higher rates. The Fed is doing the same. The next move may come down to which central bank gets more support from the data. EUR/USD lost the breakout, but the policy argument for the euro has not disappeared with it.