EURUSD weekly forecast: market sentiment shifts back towards the US dollar

EURUSD starts the new week near 1.1490 after a sharp decline and is testing an important support area. The US dollar strengthened noticeably after the Federal Reserve’s first rate hike in three years, but the technical picture for the pair has moved closer to oversold territory.

This week, the market will assess how long the US regulator is prepared to continue tightening.

EURUSD forecast for this week: quick overview

• Market focus: the key factor for EURUSD will be the reassessment of the Federal Reserve’s future rate path after the September meeting. The FOMC unanimously raised the target range by 25 basis points to 3.75–4.00%, while policymakers signalled that additional tightening could follow later this year. For the currency market, the key question is whether expectations of another rate increase remain in place. If investors continue to price in a higher terminal rate, yields and the US dollar could remain elevated. A weakening of these expectations, by contrast, would give EURUSD room to recover after a sharp weekly decline.
• Current trend: on the daily chart, EURUSD fell sharply from the 1.1600 area and approached the lower Bollinger Band. At the same time, the price is testing an ascending trendline running around 1.1450–1.1470. MACD has moved into negative territory and continues to decline, confirming strengthening selling pressure. The Stochastic Oscillator has fallen below 20 and is in oversold territory. This increases the likelihood of a short-term rebound, but for now does not invalidate the established downward momentum.
• Weekly forecast: the baseline scenario assumes continued pressure on EURUSD while the pair remains below the 1.1545–1.1600 area. At the start of the week, the market may attempt to stabilise near the ascending trend support, but a break below it would signal a continuation of the decline. Consolidation below 1.1450 would open the way towards 1.1368. For a noticeable improvement in the short-term picture, buyers would need to push the pair back above at least 1.1545.

EURUSD key levels for next week

The US dollar ended last week near seven-week highs after the Federal Reserve raised interest rates for the first time in three years. The FOMC unanimously increased the target range by 25 basis points to 3.75–4.00%, confirming the regulator’s return to monetary policy tightening.

Fed Chair Kevin Warsh stressed that inflation remains elevated, while policymakers also signalled that additional rate increases could follow later this year. This stance supports the dollar by increasing the appeal of dollar-denominated assets and keeps pressure on currencies with less hawkish rate expectations.

Another factor for the markets was the decline in oil prices for a third consecutive session following Saudi Arabia’s efforts to restore flows through the East-West pipeline. Cheaper oil reduces some inflation risks and, over time, could limit the need for aggressive Fed tightening.

The immediate market reaction therefore remains favourable for the dollar, but further movement will depend not on the September rate increase itself, but on whether the Fed convinces investors that the tightening cycle will continue through the end of the year.

EURUSD technical analysis

On the daily chart, EURUSD has fallen below the middle Bollinger Band and quickly moved towards the lower boundary of the indicator. At the same time, the pair has approached the ascending support line formed from the July lows. This area is becoming key to preserving the entire recovery structure of the past two months.

The nearest support is located around 1.1450. A break below it would increase the likelihood of a return to the July area around 1.1368. Below this, the next target is around 1.1300. Resistance is located at 1.1545, followed by 1.1604 and 1.1663.

MACD has already moved below zero and continues to deteriorate, confirming the development of downward momentum. The Stochastic Oscillator is around 12–11 points, deep in oversold territory. This creates conditions for a technical rebound, but while the price remains below 1.1545, such a rise would look more like a correction within the current decline.

The technical advantage remains with sellers, but the 1.1450 area requires a confirmed break before new short positions are opened.

EURUSD trading scenario for next week

The pair is trading directly above important trend support and is simultaneously in oversold territory, so selling at the current price carries an increased risk of a technical rebound. A more reliable signal will appear after a confirmed break below support.

Sell scenario

A consolidation below 1.1450 would confirm a break of the ascending trendline and create conditions for a continued decline towards the July lows.

• Entry level: sell stop 1.1445
• Take profit: 1.1368
• Stop loss: 1.1490
• Risk-to-reward ratio: approximately 1:1.7

The trade idea is valid until 8:00 AM on 25 September 2026 (server time, UTC+3).

If EURUSD holds above 1.1450, the trade idea will not be activated.

Summary

EURUSD begins the new week at an important technical support level after a strong US dollar rally and the Federal Reserve’s first rate hike in three years. Oversold conditions create scope for a local rebound, but the downward momentum remains intact for now.

The EURUSD forecast for 21–25 September suggests further declines if 1.1450 is broken, with the nearest target around 1.1368.

Open Account

Editors’ picks

EURUSD forecast 2026–2027: technical analysis, price levels & predictions

The EURUSD outlook for 2026 and 2027: key levels on the daily chart, three trading scenarios and the policy gap between the Fed and the ECB that drives the pair.

Gold (XAUUSD) forecast 2026: technical analysis, price levels & predictions

Where gold could trade in 2026: key levels, three trading scenarios with entry triggers and the forecasts from J.P. Morgan, Deutsche Bank and Goldman Sachs.