The single currency remains under pressure mainly due to the risks of a deepening political and debt crisis in France. On October 23, Moody's confirmed the country's sovereign credit rating at Aa3 with a negative outlook, avoiding an immediate downgrade despite concerns about the government's fiscal position. According to the French Ministry of Finance's official statement, the decision reflects the agency's assessment of the government's proposed measures to stabilise public finances. Nevertheless, the negative outlook leaves the possibility of a future downgrade open if fiscal conditions deteriorate. Political uncertainty continues to affect the government bond market: this week, yields on benchmark 10-year French securities exceeded 5.000% for the first time since 2002. Government efforts to contain public protests have yet to resolve the underlying tensions, and a prolonged crisis could undermine plans to reduce spending and stabilise the country's debt market.
The US dollar, which continues to influence the pair's movements, remains volatile, with the US Dollar Index (USDX) holding near 101.50 after declining slightly in the previous session. The movement followed investor reactions to earnings reports from major companies involved in artificial intelligence (AI), as concerns about high investment costs and future profitability weighed on technology stocks. Against this backdrop, some capital has shifted from equities into government bonds as investors seek safer assets. Meanwhile, the Federal Reserve will hold its next monetary policy meeting on October 27–28. According to the CME FedWatch Tool, markets continue to assign a high probability to unchanged interest rates, with the latest available estimates suggesting approximately an 88.0% chance of a pause.
Support and resistance levels
On the daily chart, the trading instrument remains below the support line of a broad descending channel with boundaries at 1.1620–1.1210.
Technical indicators are strengthening their sell signal: the fast exponential moving averages (EMAs) of the Alligator indicator remain below the slow ones, maintaining a stable spread, while the Awesome Oscillator (AO) histogram is forming corrective bars in negative territory.
Support levels: 1.1150, 1.0950.
Resistance levels: 1.1270, 1.1490.
EUR/USD Trading Scenarios and Exchange Rate Forecast
Short positions may be opened after the price declines and consolidates below 1.1150, with a target at 1.0950. Stop-loss: 1.1250. Estimated implementation period: 7 days or more.
Long positions may be opened after the price rises and consolidates above 1.1270, with a target at 1.1490. Stop-loss: 1.1170.
Scenario
| Timeframe | Weekly |
| Recommendation | SELL STOP |
| Entry Point | 1.1150 |
| Take Profit | 1.0950 |
| Stop Loss | 1.1250 |
| Key Levels | 1.0950, 1.1150, 1.1270, 1.1490 |
Alternative Scenario
| Recommendation | BUY STOP |
| Entry Point | 1.1270 |
| Take Profit | 1.1490 |
| Stop Loss | 1.1170 |
| Key Levels | 1.0950, 1.1150, 1.1270, 1.1490 |
