Title: EUR/USD Forecast: Bears in Control as Market Reacts to ECB Outlook
By: DailyForex.com, originally written by Christopher Lewis
The EUR/USD currency pair continues to show signs of weakness, driven by evolving economic circumstances in the Eurozone and persistent strength in the US dollar. As of early trading on September 11, 2025, market sentiment suggests that bearish pressure may intensify, particularly if there are no significant changes in European Central Bank (ECB) policy. With technical patterns indicating a continuation of the downward trend, traders are closely monitoring developments for potential entry and exit signals.
This technical analysis, originally published by Christopher Lewis at DailyForex.com, evaluates the factors influencing the EUR/USD currency pair, provides insight into the latest chart patterns and support/resistance levels, and outlines potential trade scenarios. Below is an expanded breakdown of the article, including a comprehensive interpretation of recent price action and trader strategies to consider amid growing volatility in the currency markets.
Overview of Recent Price Action
– The euro has struggled significantly throughout 2025, particularly against the US dollar.
– Recent sessions have seen the EUR/USD pair hovering near multi-month lows, with continued selling pressure pushing it closer to critical support levels.
– As of September 11, the pair trades just below the 1.07 handle, a psychologically significant level for many traders.
– Bearish momentum appears to be gaining strength, suggesting that further downside movement is likely unless counteracted by a major shift in monetary policy.
Technical Breakdown: Key Indicators and Chart Observations
Price Movement and Structure:
– On the daily chart, EUR/USD remains trapped in a clear descending channel that has persisted for several weeks.
– The market recently tested resistance close to the upper boundary of this channel but failed to break above it. This reinforces the ongoing bearish structure.
– Lower highs and lower lows continue to dominate on both shorter (4-hour) and longer (daily) timeframes.
Moving Averages:
– The 50-day Exponential Moving Average (EMA) continues to act as dynamic resistance.
– Price action remains below the 50-day EMA, currently located around the 1.0820 level, reinforcing the overall bearish sentiment.
– The 200-day EMA is trending downward as well, suggesting that even longer-term traders are leaning toward USD strength.
Momentum Indicators:
– Relative Strength Index (RSI) on the daily chart sits near 40, indicating there is room for further downside before reaching oversold conditions.
– The Moving Average Convergence Divergence (MACD) continues to show negative divergence, with signal lines trending downward and histogram bars remaining below the baseline.
Support and Resistance Levels
Traders are closely monitoring key levels that are likely to influence the near-term fate of the currency pair. These levels act as pivot points where decisions are made about continuation or reversal.
Support Levels:
– 1.0650: This level acts as the next immediate support, having previously served as a base in late August.
– 1.0600: A more psychologically significant support level, and one that could trigger stop-loss orders from long positions.
– 1.0500: If breached, this level could indicate a larger trend shift and open the door for a rapid move lower toward multi-year lows.
Resistance Levels:
– 1.0750: Initial resistance posed by recent price action and minor pullbacks.
– 1.0820: Aligns closely with the 50-day EMA and may serve as a strong cap on upward movement.
– 1.0900: A major hurdle that would need a substantial bullish catalyst, such as dovish commentary from the Federal Reserve or stronger-than-expected data from the Eurozone.
Fundamental Drivers: Eurozone vs. U.S. Economic Outlook
The divergence in monetary policy between the ECB and the U.S. Federal Reserve continues to underpin euro weakness.
European Central Bank:
– The ECB remains cautious about tightening policy
Read more on EUR/USD trading.