Market Developments & Fundamental Outlook
Euler protocol is currently dealing with a somewhat mixed bag when it comes to fundamentals. There’s some good news—the liquidity issues connected to Yala’s YU stablecoin got a bit of relief thanks to a USDC redemption plan that kicked off on December 15, 2025. This has brought some much-needed stability to EUL-backed lending markets and helped ease immediate pressure on liquidity pools, which in turn has started to rebuild some investor confidence. Add to that the expansion into Ethereum layer-2 networks like Linea and new exchange listings including Coinbase, and you’ve got improved accessibility that’s helping Euler reach more DeFi users—definitely a plus for long-term adoption. That said, it’s not all smooth sailing. The protocol still faces headwinds from lingering DeFi contagion risks (especially after those depeg scares), ongoing regulatory uncertainty, and a broader macro environment that’s been pretty unkind to altcoins lately. Most analyst forecasts reflect this push-and-pull, expecting EUL to trade mostly sideways or drift slightly lower in the near term.
Current Technical Picture (4-Hour & Daily Timeframes)
Looking at the recent technicals, the 4-hour RSI is sitting around 33.7, which means EUL is getting close to oversold territory but hasn’t quite reached the point where we’d typically see a strong bounce. The MACD on the 4-hour chart is showing a negative histogram at roughly -0.0049, with the MACD line just below the signal line—basically telling us that short-term momentum is fading. Price action is currently beneath both the 4-hour Simple Moving Average (around $2.99) and Exponential Moving Average (near $3.00), which confirms there’s still bearish pressure in play. Daily pivot analysis puts key resistance just overhead in the $2.96 to $3.01 range, while support levels hover around $2.90 and extend down toward $2.80.
Support & Resistance Levels
– Immediate resistance: roughly $3.00 to $3.05, where the 4-hour moving averages converge.
– Key resistance zone above: around $3.15 to $3.20, marking previous swing highs and daily moving average clusters.
– Support zones: initial support near $2.90; a break below $2.85 opens the door to $2.75.
– Strong support: the $2.70 to $2.80 area, which lines up with longer-term daily trend foundations.
Price Scenarios & Forecasts
Taking both the technical setup and fundamental backdrop into account, here are two realistic scenarios for the short term (one to three weeks) and medium term (one to two months):
Bullish Recovery Scenario
If EUL manages to hold above the pivot around $2.90 and can shake off some of the recent negative momentum, we could see a bounce toward the resistance zone between $3.05 and $3.20. With RSI in the 30-35 range and the possibility of selling volume drying up, conditions could be ripe for a short-term rally. A clean break above $3.20 would be significant, potentially opening the path toward $3.40—though that would definitely need some help from improving macro conditions and a more positive vibe across DeFi markets.
Bearish Continuation Scenario
On the flip side, if EUL struggles to reclaim the $3.00 level or spends meaningful time below $2.90, further downside is probably on the table. The next support sits around $2.80, and if negative momentum keeps building or Yala redemptions pick up steam, there’s real risk of sliding toward $2.70. With moving averages pointing down and MACD confirming weakness, this correction could deepen—especially if broader market risk appetite stays weak.
Longer-Term Outlook & Key Catalysts to Watch
Over the coming months, where Euler heads will largely depend on a few important factors:
– Redemption flow from Yala & stablecoin stability: Ongoing USDC redemptions and continued stabilization of YU markets will be crucial for limiting downside risks.
– Exchange listings and liquidity enhancements: Additional exchange listings, particularly in high-activity DeFi regions, along with growing Total Value Locked on partner blockchains, should provide positive support.
– Macro sentiment & DeFi rotation: Broader market shifts—whether it’s changes in Bitcoin dominance or new regulatory developments—could pull capital away from altcoins like EUL, so any risk-off environment will amplify the challenges.
– Technical thresholds: Keep an eye on the $3.20 level for any sign of a trend reversal; if that doesn’t materialize, then holding the $2.70 to $2.80 zone becomes absolutely critical for maintaining a longer-term base.
