EUR/USD Forecast
This Week

EUR/USD closed the week near 1.1183, trapped in a neutral bias after failing to hold above 1.1255 resistance. The pair remains below both the EMA20 and EMA50, signalling a bearish undertone, while RSI at 46.5 and a flat MACD confirm indecision. Last week's move was driven by mixed US data and cautious ECB commentary, leaving the pair within a 1.1110-1.1256 range. For Indian traders, this translates to a EUR/INR cross that has been relatively stable, but any breakout in EUR/USD will directly impact importers and exporters dealing with the EU, India's largest trade partner. Sentiment is cautious ahead of the US FOMC, with markets unwilling to commit directionally until the Fed's stance is clear.

Three factors dominate this week. First, the US FOMC statement on Wednesday (18:00 IST) is the primary catalyst for EUR/USD and will also influence USD/INR, with Indian traders watching for any shift in rate projections. Second, the RBI MPC Minutes on Monday (14:00 IST) will shape USD/INR expectations and indirectly affect EUR/INR derived pricing. Third, US PMI Flash on Friday (18:00 IST) will provide the final directional cue. For Indian importers, a dovish Fed could weaken the dollar and make EUR-denominated goods more expensive; exporters to the EU should monitor EUR/USD for hedging opportunities. FII flows into Indian equities may also react to USD/INR volatility stemming from these events.

Support at 1.1130 is the first line of defence; a break below could open the door to 1.1110, the lower end of the weekly range, and potentially accelerate losses toward 1.1080. Resistance at 1.1255 is the key hurdle; a sustained break above would invalidate the bearish EMA structure and target 1.1280-1.1300. Given the neutral bias, expect price to respect these levels unless a high-impact event (FOMC) forces a breakout. Indian traders should watch these levels in EUR/USD as they directly feed into EUR/INR, affecting trade invoices and remittances.

The bias remains neutral, with a slight bearish tilt due to the EMA20 below EMA50. Expect range-bound trading between 1.1130 and 1.1255 ahead of the FOMC, with volatility likely to spike around the statement. A hawkish Fed could push EUR/USD toward 1.1130 support, while a dovish surprise could test 1.1255 resistance. Watch the US PMI Flash on Friday for confirmation of any breakout. For Indian traders, monitor USD/INR reaction to RBI minutes and FOMC, as this will influence EUR/INR cross rates and hedging decisions. Key levels to watch: 1.1130, 1.1110, 1.1255, and 1.1280.