EUR/USD: Slippery slope if 1.10 breaks – Societe Generale
The EUR/USD pair is facing heightened pressure as the US Dollar shows renewed strength, with notable implications should it decisively breach the crucial 1.10 support level. Societe Generale emphasizes that the pair currently trades below its 200-week moving average, setting up a risk for a deeper slide towards the May 2025 lows, particularly if 1.10 fails to hold. This scenario highlights the increasing bearish sentiment around the Euro amidst broad market dynamics favoring the Dollar.
Where it sits in our coverage
Our consensus EUR/USD target sits at 1.1400 (median across multiple firms), with Commerzbank at the upper end (1.2200) and HSBC at the lower end (1.1000). Societe Generale's view aligns with bearish sentiment, as the pressure mounts around the 1.10 level and is reflected across various forecasts.
How firms align
Specific firms expressing similar bearish views include Investec, targeting 1.1455 for Mar26, and HSBC, which sets its target at 1.1000 for Dec26. These positions indicate alignment with the potential for losses if the support around 1.10 fails, as indicated in our /research/eurusd-ecb-rate-path-2026-11-11.
What the data shows
Recent forecast revisions have demonstrated a trend of caution among firms, with Mizuho adjusting to 1.1300 for Mar26, underscoring the shifting market dynamics. Notably, our previous insights reveal that the consensus median has been consistently around the 1.1400 mark, showcasing a divergence between current spot levels and longer-term expectations.
How firms align with this view
Key takeaways
- 01Hitting below 1.10 could trigger cascade selling in EUR/USD.
- 02Watch the 1.10 level closely for potential break; it’s critical support.
- 03Market sentiment favors the USD; expect more volatility ahead.
- 04Maintain caution around the Euro as pressures mount against it.
Market implications
Next, traders should focus on the 1.10 support level, which is critical for EUR/USD’s trajectory. A break here could suggest a shift towards deeper falls, potentially eyeing targets lower than 1.10, as reflected in our consensus number of 1.1400 for Dec26.
Risks to this view
Reversal of this bearish sentiment could occur if there are stronger-than-expected economic indicators from the Eurozone or unexpectedly dovish signals from the US Fed, which would bolster the Euro against the Dollar.
Sentiment by currency
USD+EUR JPY~GBP~Composite USD score: +0.65
Firms mentioned
Sources & References
How we cover this story
Other coverage on this pair
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