Stay 
Trading Conditions
Products
Tools
The EUR/USD currency pair stood virtually still most of Tuesday, trading around 1.1536–1.1542. The US currency strengthened over the past 4–5 days on market expectations of a Federal Reserve rate hike. There were simply no other reasons for the dollar's rise, and the market ignored all factors in favor of the euro. Recall that dollar strength began last Thursday when the European Central Bank... decided to tighten monetary policy for the second time this year, unlike the Fed. On Friday, the US inflation report was released, which was supposed to guide traders on what to expect from the Fed today. It did not, because August inflation was unchanged. Nevertheless, traders somehow interpreted inflation's persistence at 3.4% as a signal that the Fed is ready to raise rates at the upcoming meeting, so EUR/USD continued to fall over the following days. All that remains is to wait for the Fed's verdict, the reaction to which may surprise traders — after all, the market has essentially already priced in a September rate hike.
Technically, a new downtrend continues to form. Once again, the market ignored the ECB's "hawkish" decision and keeps pricing in an as-yet unmade "hawkish" Fed decision. In the short term, the dollar's prospects look more attractive than the euro's. But only in the short term. The market's mood could turn bullish this evening, since the Fed is unlikely to take an "ultra-hawkish" stance.
On the 5-minute timeframe on Tuesday, two trading signals were formed, but neither produced meaningful profits for traders. Price action was essentially absent during the day, and volatility was near zero. The market is waiting for the Fed's verdict, which it has already worked through several times.
The latest COT report is dated September 8. The weekly timeframe illustration clearly shows that non-commercial traders' net position turned "bearish" and fell sharply in 2026 due to geopolitical events. Traders have been shedding euros in favor of the US dollar over the past six months. Donald Trump's policy has not changed, but the dollar acted as a "reserve currency" for a while.
However, we still do not see any fundamental factors for further strengthening of the US currency. The war in the Middle East made the dollar temporarily super-attractive, but when that factor's "shelf life" expires, everything will return to normal. And that shelf life may already have expired. In the long term, the euro could fall as low as $1.08 (trend line), but the uptrend will remain relevant. During the recent months of dollar strength, the pair has not approached that line closely.
The placement of the red and blue indicator lines indicates an approximate parity between bulls and bears. During the last reporting week, longs in the "Non-commercial" group fell by 5,000, while shorts rose by 12,700. Accordingly, the net position for the week fell by 17,700 contracts.
On the hourly timeframe, EUR/USD continues to form a new downtrend. The ECB should have supported the euro by raising rates for the second time in 2026, but the market now sees only the Fed and its policy tightening. Thus, the dollar has effectively formed a new trend out of thin air, and market sentiment and its view of the dollar may change on Wednesday evening.
For September 16 we highlight the following trading levels — 1.1234, 1.1274, 1.1362–1.1368, 1.1461–1.1473, 1.1536–1.1542, 1.1585, 1.1657–1.1665, 1.1750–1.1760, 1.1786, 1.1830–1.1837, as well as the Senkou Span B line (1.1610) and the Kijun-sen (1.1583). The Ichimoku indicator lines may shift during the day, which should be taken into account when determining trading signals. Remember to move the Stop Loss to breakeven if the price moves 15 pips in the right direction. This will protect against possible losses if the signal proves false.
On Wednesday, the euro area will publish industrial-production data, and the US will release retail-sales figures. We advise traders to watch these releases, but most likely no market reaction will follow, since the Fed meeting and Kevin Warsh's remarks remain the main focus.
Today, traders may consider short positions targeting 1.1461–1.1473 if price consolidates below 1.1536–1.1542. A bounce from the 1.1536–1.1542 area will allow you to open long positions targeting 1.1585 and 1.1610. Volatility may be very high today, especially toward the evening when the Fed decision is announced.
Support and resistance price levels are thick red lines where movement may conclude. They are not sources of trading signals.
The Kijun-sen and Senkou Span B lines are Ichimoku indicator lines transferred to the hourly timeframe from the 4-hour timeframe. They are strong lines.
Extreme levels are thin red lines from which the price has previously rebounded. They are sources of trading signals.
Yellow lines indicate trend lines, trending channels, and any other technical patterns.
Indicator 1 on COT charts shows the size of the net position of each category of traders.
InstaForex analytical reviews will make you fully aware of market trends! Being an InstaForex client, you are provided with a large number of free services for efficient trading.
