The GBP/USD pair is currently situated at 1.3316. I am looking at how the recent advance stalled within the 1.3353-1.3404 resistance zone, which happens to be the 50% and 61.8% Fibonacci retracement levels from the move lower from 1.3569. Sellers defended this area in mid-September. The pair has since moved lower and is situated on the 100-hour SMA, which is at 1.3302, the 38.2% level.
I am looking at 1.3353 as the first resistance. A close above this level will open the 1.3404 area, and beyond that the 1.3569 level. The 1.3302 level is the first area of support, followed by the 1.3239 level, which is the 23.6% retracement, and the 1.3137 low.
EUR/USD Technical Analysis: Euro Rejected at 1.1270 as 1.1188 Support Comes Into Focus
The pair took advantage of Stochastic providing additional positive momentum, with the price making an intraday attempt to break above the 210.40 barrier and touching 210.95, bringing it closer to the key resistance level at 211.20.
The price is currently attempting to renew its corrective upside moves while holding above 210.40, increasing the chances of reaching the key resistance level. A break above this barrier would confirm a shift into a bullish trend, paving the way for significant gains that could initially start at 212.00. However, holding below this barrier would push the price to form new bearish waves, forcing it lower toward 209.50 and 208.90.
The expected trading range for today is between 209.80 and 211.20.
The pair recently succumbed to conflicting signals from the main technical indicators, particularly as stochastic provided positive momentum, prompting the formation of bullish corrective waves, with the price currently stabilizing near 177.60.
We note that the overall stability below the additional resistance barrier at 177.80 keeps us expecting the price to gather the negative momentum needed to activate the main bearish move, targeting 176.35, followed by the next target at 175.75. However, a break above this barrier and sustained trading above it will give the price an opportunity to recover further losses, gradually advancing toward 178.60 and 179.40.
The expected trading range for today is between 176.35 and 177.80.
Pound Sterling Reprieve as Dollar Slides, GBP/USD Rebounds from 2026 Low
The US Dollar posted sharp gains after the latest US inflation data, but there was a significant reversal later in the session as Treasury yields fell and a fresh technology-sector sell-off hit global risk sentiment.
The move continued into Asian trading, allowing the Pound to recover sharply against the US currency.
Stronger-than-expected UK GDP data and gains for the FTSE 100 also helped protect Sterling.
After slumping to a fresh 2026 low at 1.3137, the Pound to Dollar (GBP/USD) exchange rate rebounded towards 1.3250.
According to UoB; “The decline to 1.3137 appears to be more of a range expansion rather than the start of a sustained decline.”
Scotiabank commented; “Despite the volatility in spot in the past 24 hours, the broader range that Cable has been trading within since the spring remains effectively intact. Key support remains 1.3140/50. Gains above 1.3275/80 may drive more strength towards the low/mid 1.33s.”
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The outlook for Federal Reserve policy has become more uncertain following the sharp move in equities.
Immediately after the stronger US CPI release, markets raised the probability of an October Fed rate increase towards 50%.
Those expectations subsequently fell back as Treasury yields retreated and the technology sector came under heavy selling pressure.
A sustained decline in equities would tighten financial conditions and reduce the urgency for another near-term Fed hike.
MUFG commented; “We are still assuming that the Fed will leave rates on hold this month after comments from Fed officials indicating that they are not in a rush to hike again as soon as this month.”
The bank also highlighted the importance of changes in financial conditions following the technology sell-off.
MUFG commented; “After record capital inflows into the US equity market encouraged by investor optimism over AI, the price action overnight highlights that it leaves the US dollar vulnerable to a correction lower when investor sentiment towards AI sours.”
It added; “Nevertheless, the current fundamental backdrop remains supportive for the US dollar.”
AI Sell-Off Changes the Usual Dollar Reaction
ING also noted that the latest market move provided an unusual test of the Dollar’s traditional safe-haven role.
The bank commented; “For the FX market, overnight price action provides a preview of how currencies will perform during a big AI correction. Rather than rallying as a safe haven, the dollar weakens as the Fed cycle gets repriced dovishly.”
That dynamic could remain important if technology shares continue to fall.
Further equity-market weakness would likely pull US yields lower and reduce expectations of additional Fed tightening, which could place more pressure on the Dollar.
Conversely, a stabilisation in equities combined with persistently high inflation could restore expectations of another rate increase and revive Dollar demand.
For GBP/USD, the 1.3140-1.3150 area remains the key downside support zone.
A sustained break below that area would expose 1.3000.
On the upside, a move through 1.3275-1.3280 would strengthen the recovery and bring the low-to-mid 1.33s back into focus.
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2026.10.16 2026.10.16 EUR/USD: Elliott Wave Analysis and Forecast for 16.10.26–23.10.26
Alex Geutahttps://www.litefinance.org/blog/authors/alex-geuta/
The article covers the following subjects:
Major Takeaways
Main scenario: Once the correction has been completed, consider short positions below the level of 1.1320 with a target of 1.1040–1.0895. A sell signal: the local correction ends and the price holds below 1.1320. Stop Loss: above 1.1365, Take Profit: 1.1040–1.0895.
Alternative scenario: Breakout and consolidation above the level of 1.1320 will allow the pair to continue rising to the levels of 1.1446–1.1650. A buy signal: the level of 1.1320 is broken to the upside. Stop Loss: below 1.1275, Take Profit: 1.1446–1.1650.
Main Scenario
Consider short positions below 1.1320 with a target of 1.1040–1.0895 once the correction is completed.
Alternative Scenario
Breakout and consolidation above 1.1320 will allow the pair to continue rising to the levels of 1.1446–1.1650.
Analysis
On the weekly time frame, an ascending wave of larger degree B is developing, with wave (A) of B forming as its part. On the daily time frame, the third wave 3 of (A) is apparently unfolding. Within it, wave i of 3 has formed and a downward corrective wave ii of 3 is unfolding. On the H4 time frame, wave (c) of ii is developing. Within it, the third wave of smaller degree iii of (c) has formed, and a local correction iv of (c) is unfolding. If the presumption is correct, EUR/USD will resume declining to 1.1040–1.0895 once the correction is completed. The level of 1.1320 is critical in this scenario as a breakout above it will enable the pair to continue rising to the levels of 1.1446–1.1650.
This forecast is based on the Elliott Wave Theory. When developing trading strategies, it is essential to consider fundamental factors, as the market situation can change at any time.
Price chart of EURUSD in real time mode
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EUR/USD pulled back from session highs as traders focused on the rally in the oil markets. Oil prices gained 3% as President Trump has recently indicated that he could use the “Mother of all Bombs” against Iran. He added that he would not use nuclear. High oil prices boosted demand for safe-haven assets, which was bullish for the American currency.
In case EUR/USD settles below the 50 MA at 1.1201, it will get to the test of the nearest support, which is located in the 1.1175 – 1.1190 range. On the upside, a successful test of the resistance at 1.1250 – 1.1265 will open the way to the test of the next resistance level at 1.1350 – 1.1365.
The bearish outlook for EURJPY remains unchanged, with the pair trading below the additional resistance barrier at 177.80. This reinforces our expectation that the price will gather negative momentum and begin targeting bearish levels, initially moving toward 176.55 and then 175.75.
However, a successful break above this resistance barrier and sustained trading above it would confirm the start of new corrective waves, potentially allowing the pair to achieve some gains, initially advancing toward 178.60 and then the resistance barrier near 179.45.
The expected trading range for today is between 175.75 and 177.80.
EUR/USD is around 1.1238 on the 1 hour chart. What stands out to me is the strong recovery from 1.1113 with rising trendline support and higher lows. EUR/USD has also moved above the 1.1201 to 1.1221 resistance zone and is also above both moving averages, suggesting the bulls are in control.
I am looking at 1.1277, the high from earlier in the month, as the first serious resistance. The 1.1221 level is the first support and is followed by 1.1201 and the rising trendline. Below the trendline and 1.1201, 1.1153 and 1.1113 come into play.
RSI is near 64 and is above its signal line at 59. This tells me that the EUR/USD is in positive territory and trending up, but not to the extent that it is overbought. I am bullish while EUR/USD stays above 1.1201. Should we see a close back below 1.1201, it would call into question the breakout. A move above 1.1277 would confirm and add to the upside recovery.
PPI increased by +1.3% month-over-month in September, while analysts expected that it would grow by +0.5%.
Traders also had a chance to take a look at the Initial Jobless Claims report. The report showed that 199,000 Americans filed for unemployment benefits in a week, mostly in line with the analyst forecast of 200,000.
The strong pullback in Treasury yields served as a negative catalyst for the American currency. Treasury yields moved lower as traders rushed to buy bonds amid sell-off in AI stocks.
In case U.S. Dollar Index settles below the 101.90 level, it will head towards the nearest support, which is located in the 101.50 – 101.65 range. On the upside, a successful test of the resistance at 102.35 – 102.50 will open the way to the test of the next resistance level at 103.15 – 103.30.
EUR/USD Price Outlook: Euro Holds Near 1.12 After US PPI Jump
The Euro could stabilise against the US Dollar after finding support near 1.11, Scotiabank says, although its short-term assessment remains cautious.
Foreign exchange analysts at Scotiabank see a possible base forming beneath EUR/USD after Wednesday’s sell-off, but resistance at 1.1240-1.1250 still stands above the recovering Euro.
EUR/USD traded near 1.1203 on Thursday afternoon, little changed from Wednesday’s close, after briefly dipping below 1.12 following the latest US data.
Scotiabank described the earlier rebound: “The EUR rose close to a cent from yesterday’s intraday low through overnight trade, peaking near 1.1240 before easing back modestly.”
“Eurozone data were largely ignored (weaker than expected August Industrial Production) as markets adjusted to volatile yield and spread movement.”
In that assessment, the bank added: “Front-end EZ/US spreads have moved sharply back and forth over the past 24 hours but are now little changed from levels prevailing ahead of yesterday’s US CPI report.”
These short-dated yield gaps reflect relative interest-rate expectations, which influence the returns available on Euro and Dollar assets.
View full sizeImage: EUR/USD intraday chart after US PPI data release.
Oversold Euro (EUR) meets another inflation test
Thursday’s US producer-price report added to inflation concerns, recording a 1.3% monthly increase.
The Bureau of Labor Statistics said: “The September increase is the largest advance since rising 1.7 percent in March 2022.”
Scotiabank retains a neutral-to-bearish short-term assessment: “Bearish pressure on the EUR extended yesterday but losses were short-lived. Losses based in the low 1.11- right on the 50% retracement of the EUR’s 2025/26 rally from the low 1.01 area.”
The retracement marks the loss of half that earlier advance, rather than a 50% fall in the exchange rate.
Scotiabank says: “This may be significant and provide a platform for a heavily oversold EUR to stabilize or recover.”
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EUR/USD exchange rate FAQs
Is Scotiabank bullish on EUR/USD?
Its short-term assessment remains neutral-to-bearish, although it sees scope for stabilisation or recovery.
Where is the bank’s resistance level?
Scotiabank identifies resistance between 1.1240 and 1.1250.
Is 1.11 a forecast target?
No. It is the area where the bank identifies potential support following the recent decline.
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