Euro: Upside bias within defined range against US Dollar – UOB
The euro continues to show strength against the US dollar, maintaining an upward bias within a defined range. According to UOB, this positive momentum positions EUR/USD for potential tests of resistance levels, signaling a broader awareness of macroeconomic catalysts. If gains materialize, we could see fresh challenges to established resistance, especially as market sentiment remains tilted towards the euro despite the anticipated volatility in US economic data visibility. This strengthens the case for further upward movement ahead of the ECB rate decision on September 10.
Where it sits in our coverage
Our consensus EUR/USD target is currently positioned at 1.1700 for March 2026, reflecting a median from several firms. Notably, RBC's target aligns with the upper range at 1.2000, while Stanchart holds a lower view at 1.1400, showcasing diverse perspectives on the euro's trajectory against the dollar.
How firms align
Firms like RBC and Morgan Stanley are targeting higher levels for the euro, with RBC forecasting 1.2000 and Morgan Stanley eyeing 1.2000 for March 2026. In contrast, Stanchart’s target of 1.1400 for the same tenor presents a more conservative outlook, indicating some divergence among market participants in response to current dynamics.
What the data shows
Recent revisions show banks like UBS and Mizuho are bullish on the euro's prospects, with recent targets climbing to 1.2000 for March 2026. Our previous research has highlighted ongoing divergence, with the latest publication noting the current spot at 1.1614 against a consensus of 1.17, which adds context to the prevailing euro resilience.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01EUR/USD shows strong upside momentum, currently at 1.1446.
- 02Traders should focus on resistance tests around 1.1700-1.2000.
- 03The ECB rate decision on September 10 will be a key catalyst.
- 04Recent targets indicate firm alignment towards euro strength.
Market implications
Market participants should watch for significant resistance near 1.1700 and higher targets aligned with the bullish sentiment, particularly with the ECB's upcoming monetary policy decision. Our consensus target remains at 1.1700, reflecting optimism built upon the euro's current trajectory.
Risks to this view
Should US inflation data or labor market reports exceed expectations, we might see a reversal in the EUR/USD trend, challenging the prevailing bullish sentiment and possibly pushing the euro back towards lower targets.
Sentiment by currency
USD EUR+JPY~GBP~Composite USD score: -0.35
Sources & References
How we cover this story
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