Morning briefing: EUR/USD may extend toward 1.1250–1.13 before its longer-term downtrend resumes
The current dynamics of the EUR/USD are characterized by a bullish short-term forecast, with expectations for a potential rally to the 1.1250–1.13 range before the resumption of a longer-term downtrend. The Dollar Index remains robust above 101.50, indicating a structural strength in the USD, which will likely cap any upside for the EUR/USD. This interplay suggests a tactical opportunity for traders to capitalize on short rebounds before the downtrend reasserts itself. As the market digests this technical outlook, the anticipated movement will need to be closely monitored in the context of upcoming economic indicators.
Where it sits in our coverage
Our consensus EUR/USD target stands at 1.16 (median across 11 firms), with Commerzbank at the upper bound (1.19) and ABN AMRO at the lower (1.1284). FXStreet's view of a potential extension towards 1.1250–1.13 aligns with this framing but cautions against sustained strength beyond that mark.
How firms align
Firms like RBC and Nomura share a similarly bullish outlook with March 2026 targets of 1.1600 and 1.1700, respectively, indicating some support for the expected rise in the EUR/USD as suggested by FXStreet. On the other hand, Mizuho expects only a slight uptick to 1.1300, which runs counter to broader expectations articulated in our consensus analysis.
What the data shows
Recent forecast revisions indicate a slight bullish shift, with UBS raising its March target to 1.2000. This comes amidst prevailing discussions around the European Central Bank's (ECB) rate path. Our analysis in /research/eurusd-ecb-rate-path-2026-10-21 illustrates the divergence between the consensus average and spot prices, highlighting a significant bullish bias in market sentiment.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01EUR/USD rallies may approach 1.1250–1.13 before resuming a downtrend.
- 02DXY’s strength above 101.50 supports the USD. Monitor levels closely.
- 03Upcoming ECB announcements this month could trigger volatility in EUR/USD.
- 04Strong resistance expected beyond 1.13 as DXY maintains its bullish trajectory.
Market implications
Traders should watch for key resistance levels around 1.13 and monitor economic indicators next week. Our consensus target of 1.16 suggests that while there may be room for short-term gains, the positioning favors the USD in the longer term.
Risks to this view
A sudden shift in ECB policy or unexpected revisions in economic forecasts could invalidate the current bullish sentiment towards EUR/USD, potentially driving prices downwards if the dollar strengthens against all major currencies.
Sentiment by currency
USD+EUR JPY~GBP~Composite USD score: +0.65
Sources & References
How we cover this story
Other coverage on this pair
Euro: Range trading consolidation persists against US Dollar – UOB
EUR/USD Price Forecast: Holds gains near 1.1250, but bearish bias holds below 100-day average
French fiscal concerns risk capping EUR upside despite near-term technical strength; watch for policy response impact on EUR/USD support levels.
EUR/USD rebounds from 1 (100%) support Arc. Potential advance toward 1.1258
EUR/USD technical bounce from support Arc suggests near-term upside bias; watch 1.1258 resistance for conviction confirmation.