Riding EUR/USD sellside
The EUR/USD pair continues to experience downward momentum, with the market sentiment firmly favoring USD strength. The recent analysis highlights a bearish outlook on the euro, reinforcing the idea that any support levels around 1.08–1.09 could soon be tested. The implications of such a move are substantial, given the broader market context and current positioning dynamics. With consensus expectations diverging from the current spot, traders should stay alert to how forthcoming data may shift sentiment.
Where it sits in our coverage
Our consensus EUR/USD target currently stands at 1.1525 (median across firms), reflecting a range from 1.1200 to 1.2500. Commerzbank and Deutsche Bank project targets at the higher end, expecting levels of 1.2200 and 1.2500 respectively. Conversely, BofA has a much lower forecast for Dec26 at 1.1240, illustrating a significant divergence in views.
How firms align
JPMorgan and Goldman Sachs are aligned with the headline's sentiment, forecasting targets of 1.2000 and 1.1800 for March 2026. On the other hand, BofA’s lower target of 1.1240 suggests a contrary view, indicating potential bearish sentiment that conflicts with the prevailing market outlook. As highlighted in our research, this divergence emphasizes varying expectations regarding the euro's performance.
What the data shows
Forecast revisions have also noted a consistent trend, with firms like BofA adjusting their March target to 1.1700 recently. Research indicates that while the consensus expects strength in the USD, the current EUR/USD spot at 1.1419 is still notably beneath the expected 2026 consensus, as outlined in /research/eurusd-ecb-rate-path.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01EUR/USD currently at 1.1419, with bearish momentum expected to test lower support levels.
- 02Market sentiment is distinctly bullish on the USD, favoring short positions on the EUR.
- 03Watch for key economic data releases that could trigger movement towards the 1.08–1.09 levels.
Market implications
Traders should monitor the critical support levels around 1.08, as a breach could invite further selling pressure on the euro. Upcoming economic indicators and central bank communications will be crucial in shaping sentiment. Our consensus target of 1.1525 indicates there is limited room for further EUR appreciation in the near term.
Risks to this view
A reversal would likely occur if the ECB were to adopt a more hawkish stance or if U.S. economic data were to underperform, leading to a shift in interest rate expectations. Such developments could quickly change the dynamics in favor of 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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