EUR/USD Price Forecast: Rallies fail above 1.1200 amid high Oil prices, debt woes
- EUR/USD treads water around 1.1200 after bouncing from 16-month lows at the 1.1150 area.
- High Oil prices and France's complex debt scenario are keeping Euro bulls in check.
- Fed's Musalem has warned thst the bank will have to tighten rates further to bring inflation to target.
The Euro (EUR) is failing to capitalise on the moderate US Dollar (USD) weakness witnessed on Friday as the high Oil prices and the ongoing concerns about France’s public debt offset investors’ optimism about lower global yields. The EUR/USD pair treads water above 1.1200 ahead of the US session opening, halfway through the weekly trading range.
The US Dollar Index retreated on Thursday as a successful auction of US 30-year bonds eased concerns about government debt and sent long-term yields lower from multi-decade highs. The Euro, however, faces weaknesses of its own, as Brent prices remain above $100, threatening to tip Eurozone economies into stagflation, with French debt at historic highs and social unrest spreading across the country.
Earlier on Friday, St. Louis Fed President Alberto Musalem provided some support to the US Dollar, affirming that “more monetary policy will be needed” to bring inflation to the 2% target. Later on the day, the US Michigan Consumer Sentiment Index report might have some impact on US Dollar crosses, although the main focus remains on next week’s US Consumer Price Index (CPI) and Producer Price Index (PPI) figures, which might help to determine the timing of the Fed's next move.
Technical Indicators: Bearish momentum fades, but bulls do not show up
EUR/USD trades at 1.1214, keeping a bearish tone, on track to complete a 3.5% sell-off in a five-week losing streak. The 4-hour Relative Strength Index (14) remains capped below the 50 midline, while Moving Average Convergence Divergence (MACD) is marginally positive. These readings hint at stabilizing pressure, with bullish pressure still too weak to contemplate a bullish shift.
Price action is hovering halfway through the weekly horizontal channel, with immediate resistance at the October 2 and 8 highs around 1.1275. Further up, the next target emerges in the area between the late June lows at 1.1337 and the 38.2% Fibonacci retracement of the September-October downtrend, near 1.1350.
On the downside, immediate support emerges at the October 2 low, near 1.1160. Below here, the late May 2025 lows in the 1.1050 area emerge as a plausible target before the psychological 1.1000 level.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Euro Price This week
The table below shows the percentage change of Euro (EUR) against listed major currencies this week. Euro was the strongest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.47% | 0.10% | 0.25% | -0.20% | -0.47% | -0.00% | 0.30% | |
| EUR | -0.47% | -0.37% | -0.12% | -0.65% | -0.93% | -0.47% | -0.16% | |
| GBP | -0.10% | 0.37% | 0.23% | -0.27% | -0.57% | -0.10% | 0.22% | |
| JPY | -0.25% | 0.12% | -0.23% | -0.44% | -0.63% | -0.22% | 0.07% | |
| CAD | 0.20% | 0.65% | 0.27% | 0.44% | -0.22% | 0.11% | 0.50% | |
| AUD | 0.47% | 0.93% | 0.57% | 0.63% | 0.22% | 0.46% | 0.78% | |
| NZD | 0.00% | 0.47% | 0.10% | 0.22% | -0.11% | -0.46% | 0.31% | |
| CHF | -0.30% | 0.16% | -0.22% | -0.07% | -0.50% | -0.78% | -0.31% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).
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