EUR/USD Forecast
This Week

EUR/USD closed the week near 1.1257, after trading in a range of roughly 1.1184 to 1.1331. The pair remains under bearish pressure, with the 14-period RSI at an extremely oversold 3.6, yet MACD is still below its signal line, and the 20-day EMA sits below the 50-day EMA, confirming the downtrend. Last week, the euro was weighed down by softer Eurozone data and a broadly firm US dollar, as markets continued to price in a higher-for-longer Federal Reserve stance. For Indian traders, this matters because EUR/USD directly influences the derived EUR/INR rate. A weaker euro makes European goods cheaper for Indian importers, while Indian exporters to the EU face less favourable conversion. Sentiment remains cautious ahead of this week’s central bank events, with volatility likely to pick up.

Three factors dominate this week. First, the RBI Monetary Policy Committee minutes on Monday at 14:00 IST will shape USD/INR expectations and indirectly affect EUR/INR; any hawkish tilt could support the rupee and dampen EUR/INR upside. Second, the US FOMC statement on Wednesday at 18:00 IST is critical for EUR/USD and gold; a hawkish Fed would strengthen the dollar, pushing EUR/USD lower and weighing on MCX gold prices. Third, Friday’s US PMI flash at 18:00 IST will provide a fresh read on US economic momentum. For Indian importers and exporters, these events will determine whether EUR/INR becomes more or less favourable for trade settlement. FII flows into Indian equities may also react to US rate signals, indirectly influencing the rupee and cross-currency pairs.

The immediate support is at 1.1257, the current rate, which also aligns with the lower end of the recent weekly range. A decisive break below this level could open the door to 1.1184, the estimated weekly low, and potentially further losses. On the upside, resistance is seen at 1.1349, just above the weekly high of 1.1331. If buyers manage to push the pair above 1.1349, it would signal a potential reversal of the bearish bias and could attract momentum buying. However, given the oversold RSI, a short-term bounce cannot be ruled out, but the broader trend remains down as long as price stays below the 20-day and 50-day EMAs.

The bearish bias is likely to persist, with the pair expected to test support at 1.1257 and possibly extend losses towards 1.1184. The FOMC statement on Wednesday is the key risk event; a hawkish outcome could accelerate the decline, while a dovish surprise might trigger a relief rally towards 1.1349. Indian traders should monitor the RBI minutes on Monday for USD/INR cues, as any rupee weakness could partially offset EUR/USD moves in EUR/INR. Additionally, US jobless claims on Thursday and PMI flash on Friday will add volatility. Watch for a close below 1.1257 to confirm further downside, and a break above 1.1349 to negate the bearish view. Given the extremely low RSI, be prepared for sharp, unpredictable swings.