Euro Technical Forecast: EUR/USD Coils in September Range Ahead of Fed

Euro Technical Forecast: EUR/USD Weekly Trade Levels

• EUR/USD remains confined within a well-defined September opening range as neither bulls nor bears establish control.
• Key support has held through the recent pullback, keeping the broader recovery viable for now.
• The 52-week and 200-day moving averages converge just overhead, highlighting the first major technical hurdle for the Euro.
• A break of the monthly range should provide clearer directional guidance heading into the second half of September.
• Next week’s FOMC decision takes center stage as markets weigh the evolving policy outlook between the Fed and ECB.
• Resistance 1.1679, 1.1746/75 (key), 1.1850- Support 1.1564/78 (key), 1.1472, 1.1365

EUR/USD has struggled to build on the rebound from the July low, with recent price action reflecting a lack of conviction on either side. This week’s ECB rate hike and hawkish guidance did little to resolve the stalemate, leaving the Euro searching for a fresh directional catalyst. Attention now turns to the Fed, where next week’s policy decision could help shape the broader outlook into the second half of September. Battle lines drawn on the EUR/USD weekly technical chart.

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Euro Price Chart – EUR/USD Weekly

Chart Prepared by Michael Boutros, Sr. Technical Strategist; EUR/USD on TradingView

Technical Outlook: In my last Euro Technical Forecast we noted that EUR/USD was carving the September opening range just above pivotal support and that, “We may still be in a massive multi-month consolidation pattern here so look for a breakout to offer guidance. From a trading standpoint, losses would need to be limited to 1.1472 IF Euro is heading higher on this stretch with a close above 1.1775 needed to fuel the next major leg of the rally.” The monthly opening-range remains intact just above support and the focus remains on a breakout heading into next week’s FOMC rate decision.

Key support rests with the 38.2% retracement of the June advance and the January swing low at 1.1534/78. A break / weekly close below this threshold would be needed to validate a breakout of the September opening range and fuel a larger correction in price. Subsequent support objectives rest with the 61.8% retracement at 1.1472 and 1.1355/65- a region defined by the 38.2% retracement of the 2025 advance, the 2026 low-day close, and the April high-week close (HWC). Both these levels represent areas of interest for possible downside exhaustion / price inflection IF reached.

Initial resistance stands with the 52-week, and 200-day moving averages at 1.1629/33 and is backed by the August high-week close at 1.1679. Key resistance is eyed at 1.1745/75- a region defined by the yearly open, the 2025 high-week close, and the 2025 high close. Note that the 75% parallel of the broader upslope converges on this threshold over the next few weeks, and a breach / weekly close above would be needed to invalidate the yearly downtrend and threaten the next leg higher in price. Subsequent resistance objectives are eyed at the yearly high-week close (HWC) and the April high at 1.1850

Bottom line: EUR/USD is trading within a well-defined monthly range, just above support. Look for the breakout to offer guidance in the days ahead. From a trading standpoint, rallies would need to be limited to 1.1679 IF price is heading lower on this stretch with a break / weekly close below 1.1564 needed to fuel the next leg lower.

The monetary policy outlook remains front and center for EUR/USD following this week’s widely expected ECB rate hike, with President Lagarde’s hawkish commentary pushing market pricing toward a roughly 75% probability of another increase at the next meeting. Attention now shifts to next week’s FOMC decision, where expectations for a hike have surged following Friday’s U.S. CPI release. While inflation was largely in line with forecasts, a slightly firmer monthly core reading helped lift Fed funds futures to price an 87% probability of a rate increase next week. With both central banks signaling a willingness to tighten further, the relative trajectory of Fed and ECB policy expectations will be critical for EUR/USD in the days ahead. Stay nimble into the releases and watch the weekly close for guidance. Review my latest Euro Short-term Outlook for a closer look at the near-term EUR/USD technical trade levels.

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--- Written by Michael Boutros, Senior Technical Strategist

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