EUR/USD Holds Near 1.1570 Support as Dollar Strengthens and ECB Minutes Signal Steady Policy

Earlier this week, the European Central Bank (ECB) released the minutes from its September monetary policy meeting, confirming that the key interest rate remains at 2.15%. Despite the negative impact of U.S. export tariffs, officials offered a moderately optimistic view of the EU economy, noting that inflation is close to the 2.0% target and long-term inflation expectations remain stable — at 2.1% for 2025, 1.7% for 2026, and 1.9% for 2027. The ECB sees no need for immediate rate adjustments until the outlook becomes clearer. However, the euro continues to weaken, pressured by diverging policy expectations between the ECB and the U.S. Federal Reserve. Markets currently believe the Fed will adopt a dovish stance sooner and more decisively, making the dollar more attractive to investors. According to the CME FedWatch Tool, there is a 94.6% probability of a 25-basis-point rate cut at the October 29 meeting.

Additional pressure on the euro comes from weak trade data and continued capital outflows to the dollar. In July, the EU trade balance stood at €12.4 billion with exports of €251.5 billion and imports of €239.1 billion. Both export and import volumes rose by 0.4% and 3.1% year-on-year respectively. Even with stable inflation and mild recovery signs, the euro remains under pressure as the ECB’s cautious stance contrasts with the Fed’s dovish tilt, suggesting that downside correction could continue in the medium term.

The pair is testing 1.1650 to the upside while traders analyze Germany’s latest trade data: exports changed from –0.6% to –0.5% (vs forecast –0.3%), imports from –0.1% to –1.3% (vs –0.5%), and the trade surplus widened from €14.7 billion to €17.2 billion (vs forecast €15.2 billion). Industrial production fell sharply from 1.3% to –4.3% month-over-month (forecast –1.0%), and from 1.5% to –3.9% year-over-year amid weaker global demand and U.S. tariffs — weighing further on the euro.

Support and Resistance Levels

The long-term trend remains upward, but a corrective phase began after resistance near 1.1900 was reached. The price has since broken below 1.1730 and tested support at 1.1570. A rebound from this level could open the way to 1.1730 and 1.1900, while a breakdown could extend losses toward the July low at 1.1400.

The medium-term trend has turned bearish following a breakdown below the 1.1686–1.1663 support area, with downside targets near 1.1470–1.1449. A corrective pullback toward 1.1686–1.1663 could trigger renewed selling opportunities targeting 1.1660 and 1.1542.

Resistance levels: 1.1730, 1.1900, 1.2085.
Support levels: 1.1570, 1.1400, 1.1200.

Trading Scenarios and EUR/USD Outlook

Long positions may be opened from 1.1570 with a target at 1.1730 and stop-loss at 1.1516. Estimated timeframe: 9–12 days.

Short positions may be opened below 1.1516 with a target at 1.1400 and stop-loss at 1.1565.