Euro: Consolidation below resistance against US Dollar – Scotiabank
The euro is currently consolidating just below significant resistance against the US dollar, as noted by Scotiabank. This technical setup suggests a potential breakdown, which could reinforce the near-term outlook for USD strength. With the current EUR/USD spot at 1.1419, traders should monitor for any signs of weakness that could confirm selling pressure. The consolidation pattern highlights the fragility of the euro, particularly against a backdrop of sustained USD support.
Where it sits in our coverage
Our consensus EUR/USD target sits at 1.1583 (median across firms), with Commerzbank at the upper bound (1.2200) and MUFG at the lower (1.1800). Scotiabank’s outlook reflects a bearish bias within this range, aligning with the sentiment expressed by several firms monitoring the pair's technical context.
How firms align
Commerzbank, with targets of 1.1900 for March and 1.2000 for June, appears more optimistic than Scotiabank, supporting a bullish perspective amid broader market skepticism. On the other hand, BofA’s recent revisions advocate a more tempered view, with forecasts of 1.1700 for March and a downtrend projected towards 1.1240 by December.
What the data shows
Recent forecast revisions from BofA and ING place their March 2026 targets at 1.1700, reflecting a cautious outlook on the euro's strength against persistent USD resilience. For additional insights, see /research/eurusd-ecb-rate-path-2026-08-04.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01Watch for a potential breakdown below 1.1400 to reinforce the EUR's bearish outlook.
- 02Current EUR/USD at 1.1419 indicates vulnerability in the euro as USD strengthens.
- 03Upcoming ECB policy comments could catalyze shifts in positioning for the euro.
- 04Monitor the consolidation below resistance for an early signal of market direction.
Market implications
Moving forward, the 1.1400 level will be critical; a breach may indicate further downside for the euro. Given our consensus target at 1.1583, a sustained push below current levels could lead to adjustments in trader positioning ahead of the next economic data release.
Risks to this view
A stronger-than-expected Eurozone economic report or unexpectedly dovish signals from the US Fed could reverse euro weakness, invalidating this bearish sentiment. Additionally, improved market speculation on Eurozone recovery could also strengthen the euro against the dollar.
Sentiment by currency
USD+EUR JPY~GBP~Composite USD score: +0.35
Firms mentioned
Sources & References
How we cover this story
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