22 June EURUSD outlook: Potential for further drop Euro / U.S. DollarFOREXCOM:EURUSDChartingGenieEURUSD retreated from recent highs after briefly testing the fair value gap and resistance at 1.14725, with sellers regaining control. The pair has formed a series of lower swings, while the MACD remains in negative territory, reinforcing the prevailing bearish momentum. If selling pressure persists, EURUSD may extend its decline toward the immediate support at 1.14356. A sustained break below this level could expose further downside. Conversely, a close above 1.14725 may invalidate the near-term bearish bias and open the door for a retest of the swing high at 1.14876. Fundamentally, EURUSD remains under pressure as broad-based US dollar strength and renewed geopolitical uncertainty continue to favour the greenback. Risk sentiment deteriorated after planned US-Iran peace talks were unexpectedly canceled, raising fresh doubts over the durability of the Middle East ceasefire and increasing demand for safe-haven US dollar assets. At the same time, the Federal Reserve maintained a hawkish tone, reinforcing expectations that US interest rates could stay higher for longer and widening the policy divergence that continues to support the dollar. While the ECB has retained a restrictive bias and left the door open for additional tightening if inflation proves persistent, the central bank appears closer to the end of its hiking cycle than the Fed, limiting the euro's ability to gain traction. Overall, stronger US dollar fundamentals, elevated geopolitical risks, and ongoing policy divergence suggest the balance of risks remains tilted to the downside for EURUSD. Although expectations of a hawkish ECB may help temper its decline, they are not likely to outweigh the combination of safe-haven flows and higher-for-longer US rate expectations, leaving the pair vulnerable to further weakness. By Li Xing Gan, Financial Markets Strategist Consultant to Exness