Euro: Downtrend eyes 1.1400 support against US Dollar – UOB
The Euro continues its downward trajectory against the US Dollar, now targeting key support at 1.1400 according to UOB. This bearish sentiment reflects a broader market expectation of sustained dollar strength amidst potential Fed stability and ECB easing signals. With the current spot at 1.1446, the risk of a breakdown below 1.1400 appears significant if US economic data remains favorable. Traders should monitor incoming data closely, as the continuation of this trend may reverberate through future forecasts and positioning.
Where it sits in our coverage
Our consensus EUR/USD target is 1.1684 (median across 12 firms), with Morgan Stanley at the upper bound (1.2300) and Danske Bank at the lower (1.1100). UOB’s view aligns with the bearish sentiment, indicating a focus on the 1.1400 support level.
How firms align
Specific firms like SocGen and Nomura maintain targets of 1.1700 for March 2026 and 1.1800 across their subsequent horizons, which keeps them somewhat aligned with the bearish narrative emerging from the UOB outlook. Conversely, firms like Stanchart, targeting 1.1400 for March, echo a more conservative stance that aligns closely with imminent risks to the uptrend. Their targets illustrate a significant divergence in expectations among analysts.
What the data shows
Recent forecast revisions from BNP Paribas and Scotiabank suggest a shift towards more conservative targets, reflecting growing caution in the Euro’s outlook. These firms' revisions reinforce a bearish sentiment in the current market environment as seen in our published research, including insights from /research/eurusd-ecb-rate-path.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01EUR/USD is sickly near 1.1446, eyeing 1.1400 support.
- 02If US data stays strong, those with bullish dollar bets could see gains.
- 03Break below 1.1400 could trigger a new wave of selling pressure.
- 04Caution is warranted as ECB easing looms on the horizon.
Market implications
Next pivotal levels to watch are the 1.1400 support and any significant US economic data releases. Stronger-than-expected data could push EUR/USD further down while driving volatility in trader positioning. Our consensus points to a median target of 1.1684 which could be re-evaluated if bearish momentum increases.
Risks to this view
This bearish outlook would be challenged by a surprise shift towards hawkish commentary from the ECB or markedly poor US data that undermines dollar strength. A rebound above 1.1500 could serve as a warning signal to bullish sentiment returning to the Euro.
Sentiment by currency
USD+EUR JPY~GBP~Composite USD score: +0.65
Sources & References
How we cover this story
Other coverage on this pair
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Euro: Fair value drop points to downside against US Dollar – ING
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EUR/USD Price Forecast: Holds gains above 1.1450, but remains technically bearish below 100-day SMA
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