Euro slips back below 1.1500 as US Dollar recovers
The Euro has retreated below the key 1.1500 level as the US Dollar gains momentum, highlighting a bearish sentiment for the Euro amidst recovery signs in US economic strength. This technical breakdown at the 1.1500 threshold underscores a potential shift in market sentiment against the Euro. Traders should remain vigilant, closely monitoring the critical support at 1.1400 to see if it holds or opens the way towards deeper declines, potentially testing the 1.1300 level.
Where it sits in our coverage
Our current consensus EUR/USD target is at 1.1550 for December 2026, with a median that spans a range from 1.1200 to 1.2500 across various firms. Notably, Deutsche Bank projects the highest December target at 1.2500, while BofA is more conservative at 1.1240. This positions our view slightly above current spot levels, suggesting some alignment with ongoing bearish sentiment.
How firms align
Goldman Sachs and Morgan Stanley are among the more optimistic, forecasting EUR/USD targets of 1.1800 and 1.2000 respectively for March 2026. In contrast, BofA stands at the lower end of the spectrum with a 1.1700 outlook, showcasing a cautious stance that aligns more closely with the current bearish momentum observed in the market, as reported in our previous insights.
What the data shows
Recent revisions from BofA and ING indicate a tempered outlook as well, with BofA adjusting their March target to 1.1700 amid current volatility. Our research on the Eurozone presents a comparative analysis of how market pricing may diverge from consensus expectations, particularly highlighted in the report /research/eurusd-ecb-rate-path.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01EUR/USD rejection at 1.1500 signals bearish momentum; watch for support at 1.1400.
- 02Market sentiment is shifting, with the USD regaining strength.
- 03Failure to hold 1.1400 may lead to further declines toward 1.1300.
- 04Alignment among firms shows uncertainty in sustained Euro strength.
Market implications
Traders should closely watch the 1.1400 support level in the coming sessions, as a breach could prompt a test of 1.1300. Given our consensus target of 1.1550 for December, the current dynamics suggest that risk may skew towards further downside if the Dollar continues to strengthen.
Risks to this view
A reversal in this bearish view could occur if upcoming economic data from the Eurozone shows unexpected strength, pushing the Euro above the 1.1500 level again. Significant shifts in US monetary policy could also underpin an aggressive Dollar rally, demanding reassessment of current forecasts.
Sentiment by currency
USD+EUR JPY~GBP~Composite USD score: +0.30
Sources & References
How we cover this story
Other coverage on this pair
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