EUR/USD Price Forecast: Near-term bias turns negative on breakdown below 1.1655
The recent break below 1.1655 for EUR/USD has shifted the near-term outlook to a negative bias, potentially intensifying downside momentum. With the currency pair trading around 1.1500, this move is significant as it suggests deeper retracement could be on the table as market sentiment trends bullish for the USD and bearish for the EUR. Market participants should monitor this technical shift as it typically precedes multi-day weakness in the pair.
Where it sits in our coverage
Our consensus EUR/USD target currently stands at 1.1750, well above the current spot at 1.1500, indicating expectations for a recovery. Notably, the spread among firms is tight, with Morgan Stanley at the upper bound (1.2000) and Citi at the lower (1.1300). This positioning reflects a divergence from the recent negative sentiment triggered by technical breakdowns.
How firms align
Several firms, including JPMorgan and ING, project EUR/USD to rebound toward 1.1800 in the near term. These targets align more closely with potential upside reversals despite the recent bearish themes, as seen in our internal analysis at /research/eurusd-divergence-consensus-gap-may-2026-20260513-1605.
What the data shows
Recent forecast revisions show a mixed sentiment, with Goldman and ING predicting upward targets of 1.1800 and 1.1900 for March 2026, respectively. The contrast between current trading levels and the consensus also highlights potential market mispricing, as outlined in our related insights such as /research/eurusd-consensus-divergence-may-2026-20260512-1101.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01EUR/USD's recent break below 1.1655 indicates bearish momentum; currently at 1.1500.
- 02Traders should note potential short positions below 1.1655, targeting lower levels.
- 03Watch for downside catalysts, especially if sentiment shifts further against the EUR.
- 04Overall consensus at 1.1750 suggests divergence from current market pricing.
Market implications
In the near term, traders should closely monitor the 1.1655 level as it now acts as a key resistance. With the consensus target at 1.1750, any failure to recover above this level could suggest further downside pressure. Additionally, upcoming economic data releases could serve as potential catalysts for volatility.
Risks to this view
A return to bullish sentiment for the EUR, perhaps driven by strong economic data or dovish shifts in Federal Reserve policy, could invalidate the current bearish outlook. Specifically, if EUR/USD recovers above 1.1655, it may reset traders' expectations and lead to a potential rally.
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: Limited downside against US Dollar with ECB hike message – MUFG
ECB's continued hike messaging supports EUR/USD floor around current levels; limited downside signals reduced momentum for USD longs.
Euro: Gains capped against US Dollar by Fed story – ING
Fed rate expectations remain supportive of USD strength, structurally limiting EUR/USD upside despite recent euro resilience.
EUR/USD Price Forecast: 20-day EMA remains key barrier as Iran uncertainty persists
Euro slips as Hormuz firefight revives US Dollar demand
Geopolitical risk in Persian Gulf elevates safe-haven demand, likely to support USD/JPY parity and cap EUR/USD downside until tensions clarify.
Bank desks on this topic
FX Daily: Iran fall-out coming home to roost in EUR/USD
https://think.ing.com/articles/fx-daily-iran-fall-out-coming-home-to-roost-in-eur-usd/
FX Daily: Iran fall-out coming home to roost in EUR/USD
https://think.ing.com/articles/fx-daily-iran-fall-out-coming-home-to-roost-in-eur-usd/
FX Daily: Iran fall-out coming home to roost in EUR/USD
EUR/USD was hit in March on expectations that the stagflationary shock from Iran would resonate more in Europe than the US. The inflationary effects have been plain for all to see, but this week's release of European PMIs warns that the stagnationary effect is just starting to la
Morgan Stanley: How Much Will FX Hedging Flows Boost EUR/USD? - eFXdata
Morgan Stanley: How Much Will FX Hedging Flows Boost EUR/USD? eFXdata
Cross-firm research
EUR/USD Trades 3.16% Below Dec-26 Consensus as 18 Firms Hold 1.20 Median
With spot at 1.1621 and the 18-firm median Dec-26 target at 1.20, EUR/USD sits 3.16% below consensus—a gap that demands explanation.
EUR/USD Trades 3.2% Below Dec-26 Consensus as Targets Cluster Near 1.20
Spot at 1.1612 sits 3.2% below the 18-firm median Dec-26 target of 1.20, exposing a consensus that remains structurally bullish EUR despite the pair's failure to close the gap.
EUR/USD Trades 4% Below Dec-26 Consensus: What the Gap Reveals
EUR/USD spot at 1.1711 sits 4.01% below the eight-firm median Dec-26 target of 1.22, exposing a structural tension between macro conviction and current tape.