Cable and EUR/USD are failing rallies [Video]
Recent price action in both GBP/USD and EUR/USD indicates a failure of attempted rallies, underscoring sustained USD strength despite previous market optimism. This persistent USD demand comes amid shifting sentiment as key technical levels remain unbroken. The current dynamics suggest market participants may need to reassess their long positions ahead of upcoming economic data releases, reinforcing a cautious outlook on both currency pairs.
Where it sits in our coverage
Our consensus EUR/USD target currently sits at 1.1550 (median across multiple firms), with Morgan Stanley at the upper bound (1.2300) and BofA at the lower (1.1240). The prevailing sentiment from market players positions us closer to the lower half of the spectrum, as the recent analysis suggests a more bearish outlook on the euro amidst persistent USD strength.
How firms align
Firms such as BofA and RBC present bearish views for March 2026, with targets of 1.1700 and 1.1600 respectively. This aligns with the cautious stance inferred from today's headline of failed rallies, highlighting potential weaknesses in both GBP and EUR against the dollar. Notably, BofA's recent adjustment signals growing skepticism about EUR/USD reaching higher levels soon (/research/eurusd-ecb-rate-path-2026-07-25).
What the data shows
Recent revisions from BofA and ING show a downward tweak in targets, indicating a shift in sentiment towards a more cautious approach. Insights from our published research underscore a noticeable divergence between the current spot price and consensus targets, as outlined in /research/eurusd-ecb-rate-path-2026-07-30.
Key takeaways
- 01Failed rallies in EUR/USD and GBP/USD reinforce a bearish outlook on both pairs.
- 02Traders should prepare for potential shifts in positioning due to USD strength.
- 03Shorting slopes and trend resistance levels could be key strategy insights for upcoming sessions.
Market implications
Upcoming economic releases, particularly U.S. employment data, could serve as crucial catalysts for determining if current USD strength persists. A break below 1.1400 in EUR/USD may exacerbate bearish sentiment, aligning with our consensus target of 1.1550.
Risks to this view
Any significant shift in Federal Reserve policy or unexpected strengthening of the eurozone economic indicators could challenge this bearish view. A decisive close above 1.1500 in EUR/USD would call for reassessment of current positioning.
Sentiment by currency
USD+EUR JPY~GBPComposite USD score: +0.65
Sources & References
How we cover this story
Other coverage on this pair
EUR/USD Weekly Forecast: US Dollar in trouble as Warsh chickens out
Fed official dovish positioning reduces near-term USD support and extends EUR/USD upside window into key resistance levels.
Euro: Range seen around mid‑1.15s against US Dollar – Scotiabank
Euro slips back below 1.1500 as US Dollar recovers
EUR/USD rejection at 1.1500 signals technical breakdown; monitor whether 1.1400 support holds or reopens 1.1300 lows.