EUR/USD Price Forecast: Struggles to return above 20-day EMA, eyes on Fed policy
The EUR/USD pair continues to face technical challenges, struggling to sustain levels above the critical 20-day EMA. As the market shifts its focus to impending Federal Reserve policy decisions, this ongoing rejection indicates potential weakness. Recent sentiment remains firmly bullish on the USD, while the EUR struggles under the weight of economic uncertainties in the Eurozone. This interplay between technical analysis and broader monetary policy will be pivotal as traders assess future directional bias.
Where it sits in our coverage
Our consensus EUR/USD target sits at 1.1700 (median across firms), with HSBC at the upper bound (1.1700) and UOB at the lower (1.1536). The findings from fxstreet.com underscore a bearish sentiment towards the euro as it consistently tests resistance levels.
How firms align
Key players like HSBC and Deutsche Bank are on the optimistic side about the euro's recovery, targeting 1.1700 and 1.1800 respectively for March 2026, contrasting with more bearish outlooks from firms like UOB at 1.1536. This divergence indicates a split in market conviction regarding the euro's rebound potential.
What the data shows
Recent forecast adjustments reveal a tightening in targets among various institutions, with insights suggesting a cautious approach towards the euro. Notably, the research titled /research/eurusd-ecb-rate-path emphasizes that EUR/USD currently trades 3.5% below the median consensus target of 1.20 set for December 2026.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01EUR/USD struggles near 1.1567, hovering below 20-day EMA resistance.
- 02Traders need to monitor Fed policy as a key catalyst for USD strength.
- 03Bearish sentiment prevails; watch for resistance around 1.1700.
- 04Technical weakness signals heightened volatility in the foreseeable future.
Market implications
Upcoming Fed meetings will be crucial for market sentiment; a shift in policy could alter expectations for EUR/USD. The consensus target of 1.1700 remains a focal point to gauge potential recoveries.
Risks to this view
A reversal in this bearish sentiment could occur if upcoming economic data surprises positively for the Eurozone, or if the Fed signals a dovish shift. A move above the 20-day EMA could redefine the outlook.
Sentiment by currency
USD+EUR-JPY~GBP~Composite USD score: +0.35
Sources & References
How we cover this story
Other coverage on this pair
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