Forex · 26 October 2026
EUR/USD Holds 1.1200 Ahead of Fed and ECB Decisions
The pair trades near **1.1220** as falling Treasury yields soften the dollar, with both central banks expected to hold rates this week.
Ultimo Research
EUR/USD gathered strength during early European hours on Monday, settling near 1.1220 after a pullback in US Treasury yields reduced immediate support for the dollar. The 10-year Treasury yield dropped to 4.97%, while the 30-year yield fell to 5.30%, both hovering near one-month lows as a tech-led equity selloff spurred rotation into safe-haven bonds. The euro found additional relief after France avoided a ratings downgrade despite fiscal concerns and social unrest. Oil prices eased from six-month highs, with Brent crude futures down more than 1% to around $115 per barrel, following reports that mediators were in Tehran working to de-escalate regional tensions. The pair posted a modest daily gain of 0.16% but remained within tight ranges as traders awaited clarity from this week's central bank decisions.
What the calendar says
The Federal Reserve announces its policy decision on 2026-10-28 at 18:00 UTC, two days from now. Markets are pricing in a 90.6% probability that rates will remain on hold at the October meeting, with a 79.4% chance of a hike in December. The decision falls just days before midterm elections, reinforcing expectations for a pause. The FOMC press conference will follow at 18:30 UTC and will be scrutinized for any shift in the committee's assessment of inflation persistence and labor market resilience.
The European Central Bank follows on 2026-10-29 at 12:15 UTC, three days ahead. No change is expected in the deposit facility rate, currently at 2.5%, or the main refinancing rate at 2.65%. The focus will be on President Lagarde's press conference at 13:45 UTC for hints on the rate outlook after her late-September remarks that a moderate policy response to inflation was appropriate. Energy prices and winter supply concerns remain key variables for the ECB's inflation assessment, alongside lending conditions revealed in Tuesday's Bank Lending Survey.
Technical picture
The EUR/USD chart shows price holding gains above the 1.1200 handle but retaining a bearish near-term tone. The pair trades beneath the 100-day simple moving average at 1.1450 and below the upper Bollinger band, which capped the October 16 high at 1.1270. Price is testing the Bollinger middle band, which acts as immediate overhead resistance, while the 14-day RSI around 40 signals weak momentum rather than an outright oversold condition. On the weekly view, EUR/USD sits just above the 200-week SMA at 1.1105 but remains below the 100-week SMA at 1.1379 and the 50-week SMA at 1.1585, with the weekly RSI at 34 and the MACD still negative.
The daily pivot stands at 1.1204, with first resistance at 1.1270 coinciding with the October 16 swing high. A sustained break above that level would target the upper Bollinger band near 1.1315, followed by the 100-day SMA at 1.1450, where a clearance would be needed to shift the broader structure. On the downside, initial support lies at the October 23 low of 1.1185, then the lower Bollinger band around 1.1138. A decisive move beneath 1.1138 would expose the 1.1105 level, which aligns with the 200-week SMA and marks a critical floor for the pair. The hourly signal engine currently reads Sell, reflecting the pressure beneath the 100-day average and conflicting daily and four-hour trend signals.
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