EURUSD weekly forecast: strong growth possible
Expectations of further Federal Reserve easing after the 25-basis-point rate cut on 17 September remain the main driver for the currency market. Although the probability of additional moves is already priced in, uncertainty persists due to inflation risks and global demand for the US dollar as a safe-haven asset.
EURUSD dynamics are shaped by the combination of Fed and ECB signals, as well as reactions to fresh data from the US and the eurozone. This review examines possible EURUSD scenarios for the third decade of September, taking into account Federal Reserve decisions, inflation trajectory, and eurozone economic prospects.
EURUSD forecast for this week: quick overview
- Market focus: the Fed lowered interest rates by 25 basis points, with two more cuts planned in 2025 and one in 2026. Inflation remains above target, the labour market weakens, and the euro gains moderate support.
- Current trend: the EURUSD pair is hovering above 1.1800, but upward momentum is constrained by demand for the US dollar as a safe-haven asset.
- Outlook for 22 – 26 September: the baseline scenario suggests trading within the 1.1650–1.1830 range. A breakout upwards targets 1.1915, downwards – 1.1573 and 1.15
EURUSD fundamental analysis
The EURUSD pair is on the rise despite several volatile sessions. After the Federal Reserve meeting, markets had to reassess the Fed's policy path. The rate was lowered by 25 basis points in September, the first easing move of 2025. The Federal Reserve signalled two more cuts before the end of the year and just one in 2026, a more cautious scenario than investors had anticipated.
Jerome Powell stated that the decision was driven by risk management. He noted that inflation has risen in recent months and remains somewhat elevated, GDP growth and the labour market are slowing, and the full effects of imposed tariffs are yet to emerge. He stressed that the Fed has all the tools to respond to any challenges promptly. Meanwhile, long-term inflation expectations remain anchored around the 2% target.
Notably, Stephen Miran was the only member to advocate for a 50-basis-point cut. The rest supported the milder option, reflecting less division in the committee than expected.
Weekly summary: the US dollar remains under pressure as the Federal Reserve’s dovish tone limits its upside. Overall market sentiment remains cautiously negative towards the US currency.
EURUSD technical analysis
The EURUSD daily chart shows a confident bullish impulse. After a prolonged consolidation, the pair managed to break above the 1.1749 level, which had previously acted as strong resistance. Currently, the price is hovering near 1.1818, close to the local high at 1.1919.
Bollinger Bands show an expanding range, indicating rising volatility and confirming the strength of the current trend.MACD remains in positive territory, signalling sustained bullish momentum. The Stochastic is in the overbought zone, suggesting a possible short-term correction.
The key support level lies at 1.1749, with immediate resistance around 1.1919. Holding above 1.1749 opens the path for a test of 1.1919 and further growth. A downward breakout could push the price back to 1.1650.
EURUSD trading scenarios
Market sentiment for EURUSD this week appears neutral to cautious.
The technical setup looks positive: the pair has consolidated above 1.1749 and retains potential to move towards 1.1830–1.1915. However, the fundamental background is capping gains. The Federal Reserve only cut rates by 25 basis points, and Jerome Powell emphasised a cautious approach to easing. Inflation remains above the 2% target, limiting room for rapid action. An additional factor is global demand for the US dollar as a safe-haven asset.
- Buy scenario (long)
Long positions remain valid if the price holds above 1.1749. Confirmation would be consolidation above this level and dovish signals from the Fed. Targets are 1.1830 and 1.1915.
Stop-loss is below 1.1650.
- Sell scenario (short)
Short positions become viable if the price drops below 1.1650, particularly amid strong US data and renewed demand for the US dollar. The nearest targets are 1.1573 and then 1.1500.
Stop-loss is above 1.1830.
Summary
Overall sentiment for the EURUSD pair remains moderately positive for the euro following the 25-basis-point Federal Reserve rate cut on 17 September. Markets expect two more cuts in 2025 and one in 2026. US inflation stays above target, but the labour market shows signs of cooling, increasing expectations for continued easing.
At the same time, the US dollar receives support as a safe-haven asset amid tariff risks and global uncertainty. As a result, the balance of factors remains mixed: the technical picture points to upside potential towards 1.1830–1.1915, but fundamentals still limit momentum. In the absence of new dollar-positive drivers, the pair may hold above current levels and test the resistance area.