Euro Recovers to 1.1217 From 1.1114 Low on Dollar Retreat — Resistance at 1.1251 Caps Upside

The euro is having its best session in more than a week, and it has very little to do with Europe. EUR/USD traded at 1.1217 at 14:41 CEST on Thursday, up 0.5% from Wednesday’s close of 1.1161. The pair printed a session range of 1.1162 to 1.1242, an 80-pip band, and pushed to 1.1220 during the early European session as the dollar weakened across the board.

The bounce comes off a fresh multi-year low. On Wednesday, the hot US inflation report sent EUR/USD down to 1.1114, its weakest level in more than 17 months. The prior week’s close had already broken to a 17-month low at 1.1161 as the dollar posted its fourth consecutive weekly gain. Thursday’s recovery has erased Wednesday’s post-CPI drop but left the pair below every level it traded at in September.

The official fixings show the drift. The ECB reference rate for the dollar stood at 1.1181 on October 12, 1.1188 on October 13 and 1.1195 on October 14, set hours before the US CPI release knocked the pair to 1.1114.

The broader ranges frame the damage. Over the past seven days, EUR/USD moved between 1.1160 and 1.1253, averaging 1.1204. Over 30 days, the range ran from 1.1160 to 1.1594, with an average of 1.1348. Over 90 days, the pair traded between 1.1160 and 1.1688, averaging 1.1480. The current price sits 4% below the 90-day high and 1.2% below the 30-day average.

The year tells a bigger story. EUR/USD opened 2026 at 1.17 and hit its high near 1.20 on January 27. From that peak, the pair has fallen 6.5% to 1.1217. That reverses a large part of 2025, when the euro gained 14.37% against the dollar.

The euro has fallen 2% since late September alone, wiping out the gains it made from mid-July. That decline came despite the European Central Bank raising rates twice this year, which tells you how much of the move belongs to the dollar side of the pair.

Thursday’s bounce changes the short-term tone but not the trend. The euro rose because US Treasury yields collapsed after the hot inflation data, not because anything improved in the eurozone. The pair is retracing a crowded dollar long, and the levels above, starting at 1.1239-1.1251, are where that retracement is most likely to meet sellers.

The Dollar Side: 18-Month High Wednesday, 0.48% Lower Thursday

The dollar drove every tick in EUR/USD this week. The US dollar index hit an 18-month high on Wednesday after US consumer inflation rose to 3.7% in September, above forecasts. Heading into the week, the index stood at 102.06 with a weekly high of 102.53, while the US 10-year yield sat near 5.29%. After the CPI release, the index faded to 101.74.

Thursday extended the reversal. The dollar weakened 0.48% against the euro during the European morning, 0.38% against sterling, 0.22% against the yen and 0.59% against the Swiss franc. The franc’s outperformance points to a safe-haven bid inside Europe, while the euro’s gain reflects the broad dollar retreat.

The trigger was the bond market. The 10-year Treasury yield fell 14 basis points to 5.05%, after touching 5.36% on October 7, its highest level since 2002. Both the 10-year and the 30-year yields fell more than 13 basis points, putting the 30-year on track for its biggest single-day drop since November 25, 2024.

That decline came on a hot inflation print, which is the key to the euro’s bounce. The September Producer Price Index rose 1.3% for the month and 6.3% over 12 months, the largest monthly gain since March 2022 and the biggest annual rise since December 2022. Forecasts called for 0.6% and 5.5%. In a normal regime, that print would lift US yields and the dollar. Instead, investors bought Treasuries as US equities sold off on AI financing fears, and the dollar fell with yields.

US equities explain the shift. The Nasdaq Composite fell 1.05% to 26,411.88 after a 1.9% drop Wednesday, as chip stocks lost ground for an eighth straight session and CoreWeave dropped 6.89% to $61.25 on debt concerns. When US risk assets sell off on credit fears, Treasury demand rises and the yield advantage that has supported the dollar narrows.

The dollar bounce had been crowded. Four straight weekly gains built a large long-dollar position going into the CPI release. Once the inflation data failed to push US yields higher, those positions started to unwind, which accounts for part of the euro’s 80-pip range Thursday.

The dollar index’s path from here sets EUR/USD’s direction. A sustained move below 101.50 would likely push the pair through 1.1250 toward 1.1290. A rebound above 102.53 would put the 1.1114 low back in play within days.

US Inflation Shock: 3.7% CPI, 6.3% PPI and a Stalled Consumer

The US data this week cut both ways for the dollar. September CPI rose 3.7% annually, above the 3.6% forecast, with core at 2.6% against 2.5%. In August, those figures were 3.4% and 2.4%. Headline and core both moved further from the Fed’s 2% target.

Producer prices were hotter still. Final demand goods prices rose 2.6% in September, the largest increase since the series started in December 2009, with energy up 10.8% and gasoline up 20.3%. Core producer prices, which exclude food, energy and trade services, rose 0.5% for the month and 5.0% over 12 months. Services prices rose 0.8%, the largest increase since April.

The consumer data weakened the dollar case. Retail sales rose 0.8% in September against a 0.3% forecast, but the control group, which feeds into GDP, rose just 0.1% against 0.3%, after 1.4% in August. Gasoline drove most of the headline gain.

That combination matters for currency markets. Hot inflation alone supports the dollar by raising expected Fed rates. Hot inflation with stalling real demand raises the risk of a growth slowdown, which tends to push long-term yields lower and weaken the currency over time. Thursday’s 14-basis-point drop in the 10-year yield shows markets leaning toward the second interpretation.

The energy component links both economies. The US data shows the Iran war and the Strait of Hormuz disruptions feeding into producer prices at a rate not seen since 2022. The same energy shock is hitting the eurozone harder, because Europe imports most of its energy. That shared shock caps how much the euro can gain from US weakness alone.

The inflation pipeline points to more pressure in both regions. US processed intermediate goods prices rose 14.1% over 12 months, and unprocessed goods rose 21.5%, led by a 28.3% jump in crude petroleum. Those costs reach consumers over the next two to three months, keeping inflation elevated into the end of the year on both sides of the Atlantic.

For EUR/USD, the US data creates a ceiling and a floor at the same time. Inflation keeps the Fed hawkish, which supports the dollar. Growth concerns pull US yields down, which weakens it. The result is a choppy range in which the pair reacts sharply to yield moves but struggles to establish a sustained trend in either direction.

Fed Math: October Hike Odds Jump From 22% to 49%

The Federal Reserve is the most important driver of the pair over the next two weeks. Before Wednesday’s CPI, futures priced a 22.1% chance of a 25-basis-point hike at the October 27-28 FOMC meeting. After the release, those odds jumped above 49% before settling below 45%, while December hike odds sat at 89.7%. The US inflation data roughly doubled traders’ bets on an October Fed hike.

The Fed has already tightened once this cycle. Policymakers raised the target range by 25 basis points to 3.75%-4.00% in September, the first increase since 2023. September minutes showed most participants judged another increase likely appropriate by year-end. An October hike would lift the range to 4.00%-4.25%.

Fed Chair Kevin Warsh speaks Friday, the last major policy signal before the pre-meeting blackout. A clear signal that October is live would push US yields back up and likely send EUR/USD toward 1.1114. Language emphasizing patience and the need for October data would extend the dollar’s retreat and open the path toward 1.1290.

Politics add complexity. The November 3 midterms fall one week after the meeting, and White House officials have publicly urged the Fed to wait for October inflation data. A Fed seen as yielding to political pressure would weaken the dollar’s policy-credibility premium, which would support the euro.

The policy gap is the core of the pair. The Fed’s upper bound stands at 4.00%. The ECB’s deposit rate stands at 2.50%. That 150-basis-point gap at the upper end of the range is why EUR/USD has been grinding lower: investors earn more holding dollar deposits than euro deposits, and the gap widens every time the Fed hikes faster than the ECB.

The timing makes the next two weeks pivotal. The Fed decides on October 28, the ECB on October 29. If the Fed hikes and the ECB holds, the gap widens to 175 basis points at the upper bound and EUR/USD likely breaks below 1.1100. If the Fed holds and the ECB signals December, the gap stays at 150 basis points and the euro’s recovery can extend.

The market’s base case points to a dollar-supportive outcome: elevated Fed hike odds against an ECB widely expected to hold in October. That setup favors fading euro rallies until one of those expectations changes.

ECB Deposit Rate at 2.50%: Two Hikes and No Shield

The European Central Bank has tightened, but it hasn’t saved the euro. The ECB raised its deposit rate by 25 basis points to 2.50% on September 10, its second hike this year, lifting the main refinancing rate to 2.65%. The move targeted the energy shock from the Iran war. The monetary policy statement said the Middle East conflict would keep inflation well above target for an extended period.

Staff projections accompanied the move. The ECB forecast headline inflation averaging 3% in 2026, then 2.5% in 2027 and 2.1% in 2028. Growth forecasts rose to 0.9% for 2026 and 1.4% for 2027, with 2028 unchanged at 1.5%, reflecting greater-than-expected resilience in the euro area economy.

Lagarde has argued for patience since. In a September 28 speech, she said inflation had not yet produced dangerous second-round effects, so a measured policy response remained appropriate. She acknowledged that risks were skewed toward higher inflation but attributed the surge mainly to oil and gas prices tied to the US-Iran conflict. That stance pushed back against market bets on up to four more hikes over the next year.

Markets responded by pricing out October. Futures implied a 60% chance of an October ECB hike on September 24. As Lagarde argued for measured action and markets priced out an October move between September 25 and October 7, the euro-area two-year yield fell 25 basis points and the five-year yield fell 20 basis points. Traders now expect a hold on October 29 followed by a hike in December, when new projections are released.

That repricing explains the euro’s slide since late September. A falling two-year euro yield against a rising two-year US yield widens the short-term rate gap that drives EUR/USD. The ECB effectively chose to tolerate a weaker currency rather than signal more hikes.

A weaker euro creates its own problem. Europe imports oil and gas priced in dollars, so every 1% decline in EUR/USD raises the euro cost of energy imports by the same amount. A central bank fighting energy inflation while its currency falls faces a feedback loop that eventually forces a more hawkish response.

That loop is the euro’s main medium-term support. If EUR/USD breaks below 1.1100 while euro-area inflation stays near 4%, the ECB’s patience will come under pressure. A shift in tone toward an October hike would be the clearest catalyst for a euro recovery toward 1.1400.

Eurozone Inflation at 3.8%: The Highest in Three Years

The euro-area inflation picture is worse than the US one on the headline. The September flash estimate put euro-area inflation at 3.8%, the highest in three years, with energy prices up 18.8% from a year earlier. In August, final inflation came in at 3.2%, revised from a 3.3% flash estimate, with energy inflation at 14.3%. Inflation stood at 2.9% in July.

The trajectory is steep. Euro-area inflation has risen from 2.9% in July to 3.8% in September, a 90-basis-point increase in two months. Energy inflation jumped from 10.3% in July to 14.3% in August and 18.8% in September. That pace matches the US producer price data, where energy rose 10.8% in a single month.

Final September figures arrive Friday. Eurostat publishes the final euro-area inflation reading alongside Warsh’s speech, giving the pair two major catalysts in one session. A confirmation at 3.8% or an upward revision would raise pressure on the ECB and offer modest support to the euro. A downward revision would reinforce the ECB’s case for patience.

The comparison with the US matters for the pair. Euro-area headline inflation at 3.8% sits above US CPI at 3.7%, yet the ECB’s deposit rate at 2.50% sits 125 to 150 basis points below the Fed’s range. That makes euro-area real interest rates deeply negative while US real rates are positive. Negative real rates weaken a currency over time, because they erode the purchasing power of euro deposits.

The energy split explains the gap. Europe imports most of its energy, leaving it far more exposed to the oil spike than the US, which is a major energy producer. Brent traded at $104.60 Thursday, down 1.34%, after a US official said the administration was weighing easing sanctions on some Russian shadow-fleet tankers. WTI traded at $94.47.

The terms-of-trade effect is direct. When oil rises, Europe pays more for imports and its trade balance deteriorates, which weakens the euro. The US, as a net energy exporter, earns more from higher prices. Every $10 rise in Brent shifts trade flows against the euro and toward the dollar.

Inflation forecasts point higher. Euro-area inflation may approach 4% by the end of the year, double the ECB’s target. If that happens with the deposit rate still at 2.50%, real rates in the euro area would sit near minus 1.5%, a level that historically weighs on the currency.

French Fiscal Stress and a Widening Bund Spread

The euro faces a second, homegrown problem. Heightened French fiscal concerns are likely to keep the euro under pressure, and the spread between French and German 10-year government bond yields has widened toward 130 basis points. In earlier sessions, that spread widening pushed EUR/USD down to 1.1312.

Sovereign spreads matter for the currency. A widening gap between French and German yields signals that investors demand more compensation to hold the debt of the euro area’s second-largest economy. That raises questions about fiscal sustainability, political stability and, in extreme cases, the cohesion of the monetary union. Each of those concerns adds a risk premium to the euro.

Lagarde addressed the issue Wednesday. On the sidelines of the IMF and World Bank meetings in Bangkok, she linked part of the euro’s weakness to fiscal policy rather than monetary policy. That framing signals the ECB won’t use rate policy to offset fiscal stress, leaving the euro exposed to political developments in Paris.

Equity markets confirm the regional stress. Germany’s DAX fell 115 points to 25,183 Thursday, while Britain’s FTSE 100 rose 50 points to 10,778. The DAX carries heavier exposure to industrial and technology stocks that are sensitive to the AI selloff, while the FTSE leans on energy, miners and staples. The divergence shows investors are cutting euro-area risk exposure.

French spreads act as a stress gauge for EUR/USD. If the spread moves above 130 basis points, the euro’s downside accelerates as foreign investors reduce euro-area bond holdings. If it narrows below 110 basis points, the euro loses one of its main headwinds and can track the dollar’s weakness more cleanly.

The interaction with the ECB is delicate. Higher policy rates raise borrowing costs for governments with large deficits, including France. A more hawkish ECB to defend the euro could widen French spreads further, which would weaken the euro through the fiscal channel. That trade-off limits how aggressively the ECB can respond to the currency’s decline.

For the forecast, French fiscal risk acts as a cap on euro rallies. Even if the dollar weakens further, the euro will struggle to recover to the 1.1400-1.1500 range seen in August and early September while the French spread remains near current levels.

Real Rate Gap: Why the Bounce Struggles

The math behind the trend is the gap in real interest rates. US CPI stands at 3.7% with the Fed’s upper bound at 4.00%, giving a positive real policy rate. Euro-area inflation stands at 3.8% with the ECB deposit rate at 2.50%, leaving a real policy rate below minus 1.2%. That gap of more than 1.5 percentage points in real rates favors the dollar.

Long-term rates show the same imbalance. The US 10-year real yield stood at 2.92% on October 8, with breakeven inflation at 2.35%. Real yields near 3% in the US offer global investors an inflation-protected return that euro-area bonds don’t match. Capital flows toward the higher real yield, supporting the dollar.

The two-year segment is where the move lives. The US two-year yield stood at 4.79% on October 7. The euro-area two-year yield fell 25 basis points between September 25 and October 7 as markets priced out an October ECB hike. That divergence of short-term rate expectations accounts for most of the euro’s 2% decline since late September.

Thursday’s bounce narrows the gap only slightly. A 14-basis-point drop in the US 10-year yield trims the long-term spread, but short-term rate expectations still favor the dollar because Fed hike odds remain elevated. Unless the market prices out the October Fed hike or prices in an October ECB hike, the two-year gap won’t close enough to change the trend.

Momentum indicators reflect that. The MACD reading on EUR/USD stood at -0.001, a sell signal, even as the pair rose 0.54% Thursday. The 20-period exponential moving average on the daily chart sits at 1.1290, above the current price, keeping the near-term bias bearish.

The flows are mostly short-covering. The euro’s rise came from falling US yields and institutional short-covering after a four-week dollar rally, not from new long-euro positioning. Short-covering rallies tend to stall at the first major resistance level, which in this case sits at 1.1239-1.1251.

The real-rate gap would close only through a policy shift. Either the Fed signals no more hikes, or the ECB signals more. Until one of those happens, the structural pressure on EUR/USD remains downward, and rallies are likely to be sold.

Risk Sentiment: AI Selloff, Kospi -7.6% and the Haven Bid

Global risk sentiment set the backdrop for Thursday’s currency moves. The AI and semiconductor selloff spread from Wall Street to Asia overnight. South Korea’s Kospi fell 7.57%, Japan’s Nikkei 225 lost 5% and Taiwan’s weighted index dropped 3.41%. In New York, the S&P 500 traded at 7,686.53, down 0.42%, and the Nasdaq at 26,411.88, down 1.05%.

Risk-off episodes usually support the dollar. In most cycles, global investors seek dollar liquidity during market stress, which lifts the dollar against risk-sensitive currencies. This week has broken that pattern. The dollar fell Thursday because the stress originated in US assets, specifically the debt-financed AI infrastructure trade, which led investors into Treasuries and out of the dollar’s growth premium.

The Swiss franc captured the European haven flows. The franc gained 0.59% against the dollar, outperforming the euro’s 0.48%. EUR/CHF moved lower, which signals that European investors seeking safety are choosing the franc over the euro. That limits the euro’s upside even in a weak-dollar environment.

Gold confirms the haven rotation. Gold futures rose 1.79% to $4,181.30 Thursday while Bitcoin fell 2.38% to $80,284.33. The VIX traded at 17.70, up 4.9%. Investors are cutting exposure to AI-linked equities and crypto and moving into Treasuries, gold and the franc.

The euro sits in the middle of that spectrum. It’s not a haven like the franc or gold, and it’s not a risk asset like the Nasdaq or Bitcoin. Its moves depend on the relative performance of US and euro-area assets. With euro-area equities also under pressure, as the DAX’s 115-point drop shows, the euro gains only when US-specific stress outweighs European stress.

That dynamic sets a limit on the bounce. If the AI selloff spreads to European technology and industrial stocks, euro-area growth fears would rise and the euro would lose its advantage from falling US yields. If the selloff stays concentrated in US tech, the euro can extend its recovery toward the 1.1250-1.1290 zone.

Asian markets on Friday are the next test. A second sharp decline in the Kospi would extend global risk aversion. A stabilization in Asian technology stocks would reduce Treasury demand, lift US yields and probably pull EUR/USD back toward 1.1180.

Oil at $104.60: Europe’s Energy Bill Weighs on the Euro

Energy is the euro’s structural weakness in 2026. Brent crude traded at $104.60 Thursday, down 1.34%, while WTI traded at $94.47. Oil slipped after a US official said the administration was weighing easing sanctions on some Russian shadow-fleet tankers to lower freight rates, days after President Trump temporarily lifted sanctions on Russian diesel.

The conflict keeps prices elevated. A container ship and a dry-bulk carrier sank near the strait in the previous 24 hours after being hit by projectiles. Attacks around the waterway have surged over the past 10 days as Iran steps up strikes in response to the US blockade of its ports. US military planners have developed new strike options against Iranian energy infrastructure and nuclear sites after more than six months of US bombing.

Europe pays the price. Euro-area energy inflation reached 18.8% in September, up from 14.3% in August and 10.3% in July. The ECB cited the Middle East conflict directly in its September statement. Every sustained rise in Brent widens Europe’s import bill and erodes its trade surplus, a key historical support for the euro.

Ukraine adds another channel. Ukrainian forces resumed strikes on Russian refineries, hitting a plant in the Ryazan region. Russian refined-product exports, particularly diesel, matter more for Europe than for the US, so disruptions there feed directly into euro-area inflation.

The US-Europe contrast drives the currency effect. The US is a net energy exporter, so higher oil prices improve its terms of trade. Europe is a net importer, so the same move worsens its terms of trade. That asymmetry means oil above $100 favors the dollar over the euro, independent of interest rates.

The sanctions headline offers some relief. If the US eases restrictions on Russian shadow-fleet tankers, freight rates and diesel prices could fall, lowering Europe’s energy costs. Brent’s 1.34% drop Thursday reflects that possibility and contributed modestly to the euro’s bounce.

For the forecast, Brent above $100 acts as a structural cap on the euro. A ceasefire that pushed Brent below $90 would be one of the most powerful bullish catalysts for EUR/USD, likely sending the pair toward 1.1400 within weeks. Without that, energy keeps pressure on the euro through both the inflation and trade channels.

Technical Map: 1.1114 Floor, 1.1251 Ceiling

The chart has clear boundaries. Support starts at the session low of 1.1162, followed by 1.1182, a short-term target for sellers. The October 14 low at 1.1114 is the key level. A break below it exposes the psychological 1.1000 mark, 1.9% below the current price.

Resistance is layered above. The euro has corrected into the boundary of its short-term downtrend at 1.1239-1.1251, where sellers are holding for now. Thursday’s session high at 1.1242 sits inside that zone. The 7-day high at 1.1253 adds to the resistance. Above that, the 20-day exponential moving average at 1.1290 forms the next ceiling.

A break of resistance would change the picture. A move above 1.1251 would turn the short-term trend upward and open a path to the 1.1365-1.1390 target zone. That would be the first meaningful higher high since the euro began its slide in late September.

The broader trend remains down. The 30-day average at 1.1348 and the 90-day average at 1.1480 both sit well above the current price. The pair has made a series of lower highs and lower lows since the 90-day high at 1.1688, with the most recent low at 1.1114 marking a new cycle bottom.

Positioning favors volatility around the boundaries. The four-week dollar rally built crowded positions, and Thursday’s short-covering rally has partly cleared them. If sellers defend 1.1239-1.1251, the pair likely returns to the 1.1180 area. If buyers break through, short-covering could accelerate toward 1.1290 quickly.

The daily close sets the bias. A close above 1.1251 would signal that the bounce has momentum beyond short-covering. A close back below 1.1180 would confirm that the rally failed at resistance and would put 1.1114 back in focus.

Friday’s events will likely decide which boundary breaks first. Warsh’s speech and the final euro-area inflation reading arrive within hours of each other, and both carry enough weight to push the pair 50-80 pips in either direction.

Scenarios Into October 28-29: 1.1000 Downside, 1.1390 Upside

The base case is a capped range. If Warsh keeps the October hike option open without committing to it, euro-area inflation is confirmed at 3.8% and the AI selloff stabilizes, EUR/USD trades between 1.1150 and 1.1290 into the Fed decision on October 28. Rallies toward 1.1250 meet sellers, and dips toward 1.1150 attract short-covering as US yields stay near 5.05%. The pair likely ends October between 1.1180 and 1.1250.

The bearish case requires a hawkish Fed and a patient ECB. If Warsh signals that October is live, US yields rebound above 5.20% and the dollar index reclaims 102.53, EUR/USD breaks 1.1114 and targets 1.1000. A Fed hike on October 28 followed by an ECB hold on October 29 would widen the policy gap to 175 basis points at the upper bound and could push the pair below 1.1000 for the first time since mid-2025. That would be a 1.9% decline from current levels.

The bullish case needs a shift in either central bank’s stance. If Warsh signals patience, US yields fall below 5.00% and the dollar index breaks 101.50, EUR/USD clears 1.1251 and targets 1.1290, then 1.1365-1.1390. An ECB signal toward an October hike, perhaps after a hot final inflation reading, would add fuel. A ceasefire in the Strait of Hormuz that pushes Brent below $90 would be the strongest upside catalyst. The 1.1390 target represents a 1.5% gain.

The probabilities favor the base and bearish cases. The policy gap, the real-rate gap, Europe’s energy exposure and French fiscal stress all point the same direction. The euro’s main support comes from US weakness, not European strength, and that support depends on continued stress in US equities.

Three triggers will decide the path. First, the US 10-year yield, where a hold below 5.10% keeps the euro supported. Second, the ECB’s tone, where any hint of an October hike would lift the pair. Third, Brent, where a move below $95 would ease Europe’s energy burden.

Verdict: Bearish Bias, Fade Rallies Into 1.1250

EUR/USD’s 0.5% bounce to 1.1217 is a dollar story, not a euro story. The pair rose because the US 10-year Treasury yield fell 14 basis points to 5.05% after a hot 6.3% producer price print sent investors into bonds during the AI equity selloff, and because a crowded four-week dollar rally began to unwind. Nothing in the eurozone improved. Inflation sits at 3.8%, the highest in three years, energy prices are up 18.8% from a year earlier, and the ECB’s deposit rate at 2.50% leaves real rates deeply negative.

The structural drivers still favor the dollar. The Fed’s upper bound at 4.00% sits 150 basis points above the ECB’s deposit rate, with October Fed hike odds jumping from 22.1% to as high as 49% after this week’s inflation data while traders expect the ECB to hold on October 29. Brent at $104.60 weighs on Europe’s terms of trade, and French-German spreads near 130 basis points add a fiscal risk premium. The pair has fallen 6.5% from its January peak near 1.20 and 2% since late September.

The forecast is bearish with a short-term bounce. Expect EUR/USD to meet sellers in the 1.1239-1.1251 zone and drift back toward 1.1180 in the coming sessions, with the October 14 low at 1.1114 as the key support into the October 28 Fed and October 29 ECB decisions. A daily close below 1.1114 targets 1.1000. Only a daily close above 1.1251, most likely triggered by a dovish Warsh on Friday or a hawkish turn from the ECB, would flip the setup and open the path toward 1.1290 and 1.1390.

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