The euro faces downside pressure toward the 1.140 level against the US dollar before any meaningful recovery can take hold, according to ING currency strategist Francesco Pesole. The expected pullback reflects persistent dollar strength following recent Federal Reserve policy signals that continue to reverberate through currency markets.
Traders should prepare for near-term weakness in the EUR/USD pair as post-Fed momentum sustains greenback demand. The 1.140 threshold represents a critical technical level that may need testing before bullish sentiment can return to the euro. This outlook affects forex traders positioning in the world’s most liquid currency pair, as well as European exporters and multinational corporations managing dollar exposure.
The timing of any potential bounce remains uncertain, with market participants monitoring upcoming economic data and central bank commentary from both the European Central Bank and Federal Reserve for direction. Currency volatility could create trading opportunities for those prepared to navigate the anticipated downward test.
FXnCO Insight
Consider setting defensive stops above 1.140 for long euro positions while watching for reversal signals at that support level to capture the projected recovery phase.
Source: FXStreet