EUR/USD Price Forecast: Corrects further as US Dollar extends recovery
The EUR/USD pair is experiencing a deeper correction as the US Dollar strengthens, driven by rising yields and robust economic data. This price action shows a significant shift in market sentiment, with traders now testing crucial technical support levels. The continuation of USD strength is likely to impact investor positioning, particularly among systematic traders, as they reassess their strategies in light of a bearish EUR outlook.
Where it sits in our coverage
Our consensus EUR/USD target sits at 1.1700 (median across 12 firms), reflecting a range from 1.1100 to 1.2300. Notably, Morgan Stanley and UBS align with the upper bound, both targeting 1.2000 for March 2026.
How firms align
Investec projects a relatively cautious view with their March target at 1.1455, while firms like Stanchart maintain a bearish outlook with a 1.1400 target. For further insights, see our internal /reports/investec and /reports/stanchart.
What the data shows
Recent revisions show UOB lowering their March target to 1.1536, indicating a bearish shift. Additionally, our latest research highlights the consensus target of 1.17, aligning with current market dynamics as outlined in /research/eurusd-ecb-rate-path-2026-08-24.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01EUR/USD correction reflects strengthening USD alongside bearish sentiment on the Euro.
- 02Traders are eyeing key support levels as the pair tests the downside.
- 03March target from Investec at 1.1455 signals cautious positioning in the market.
Market implications
Watch for breaks below the technical support around 1.1400, which may trigger increased selling pressure. Upcoming US economic data releases could further influence the dollar's trajectory relative to the Euro.
Risks to this view
A reversal could occur if the Eurozone exhibits stronger economic resilience or if US data underwhelms, contradicting current bullish dollar sentiment.
Sentiment by currency
USD+EUR JPY~GBP~Composite USD score: +0.65
Sources & References
How we cover this story
Other coverage on this pair
Euro: Further gains eyed toward 1.1800 against US Dollar – UOB
EUR/USD technical target of 1.1800 suggests directional bias toward euro strength; traders should monitor resistance levels and macro catalysts driving momentum.
Morning briefing: EUR/USD is expected to regain momentum above 1.1700
Technical break above 1.1700 may attract momentum flows; watch for ECB/Fed divergence confirmation to validate further EUR/USD upside.
Euro gains support amid hawkish ECB expectations, subdued US Dollar
ECB hawkish repricing supports EUR near-term, but entry point clarity needed as positioning likely extended.