The Fed offered no clear signals; now it is the ECB's turn as the market awaits a sharp move in EURUSD

The euro received some modest, short-lived support following the Fed's decision, with the EURUSD rate currently hovering at 1.1140. Discover more in our analysis for 29 October 2026.

EURUSD forecast: key takeaways

• The ECB meeting takes place on 28–29 October
• The Federal Reserve held its interest rate steady at 4.0%
• EURUSD forecast for 29 October 2026: 1.1200 and 1.1100

Fundamental analysis

The EURUSD forecast takes into account that the currency market is focused today on central bank meetings and decisions. The Fed kept its interest rate unchanged at 4.0% but offered no clear signal about its next steps. The euro received some support following the market's initial reaction, but economic and fiscal risks in the eurozone continue to limit its recovery potential.

The Fed's decision was approved by a 10–2 vote. Federal Reserve Chairman Kevin Warsh noted that inflation could be brought down without a sharp economic slowdown. Meanwhile, the market estimates the likelihood of a rate hike in December at around 78.0%, which continues to bolster the USD.

The ECB will announce its interest rate decision today. The baseline scenario anticipates the rate will remain unchanged at 2.65%. Investors will assess the central bank's comments on inflation, energy costs, and the outlook for further monetary policy tightening. More dovish ECB rhetoric could increase pressure on the euro.

France's fiscal problems remain a weak point for the euro. High government borrowing costs and difficulties in reducing the budget deficit are making investors more cautious about European assets. Rising energy prices are adding pressure by simultaneously fuelling inflation and dampening economic activity.

The fundamental outlook for EURUSD on 29 October remains moderately negative for the euro. The Federal Reserve's decision has not yet ruled out the possibility of further policy tightening, while France's fiscal risks and high energy prices are complicating the situation in the eurozone. Today's ECB meeting will be the key short-term event: more hawkish signals could support the euro, while cautious rhetoric could add to pressure on the pair.

Technical outlook

On the H4 chart, the EURUSD pair formed a Hanging Man reversal pattern during a pullback near the middle Bollinger Band. At this stage, the price could develop a downward wave as the pattern's signal plays out, with the downside target at the 1.1100 support level. A breakout below this mark would open the way for a continued downtrend.

However, today's EURUSD forecast also envisages an alternative scenario in which the price could develop a corrective wave and test the 1.1200 resistance level before declining.

EURUSD overview

• Asset: EURUSD
• Timeframe: H4
• Trend: bearish
• Key resistance levels: 1.1200 and 1.1260
• Key support levels: 1.1100 and 1.1050

EURUSD trading scenario for today

A breakout below the 1.1100 support level would signal the start of a new downward wave and set the stage for opening short positions.

Risk factors

The main risk factors for the EURUSD pair remain the upcoming ECB interest rate decision and policymakers' comments on the future direction of monetary policy. More hawkish Federal Reserve rhetoric could strengthen the dollar, while ECB signals of a possible rate hike could support the euro. Further uncertainty is caused by the release of US GDP data, inflation developments, France's fiscal problems, and fluctuations in energy prices.

Summary

The Fed's decision to leave interest rates unchanged provided some support for the euro, but this was short-lived. Attention now turns to the ECB. EURUSD technical analysis suggests that the price will fall towards the 1.1100 support level following a correction.

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