EUR/USD Faces a Key Rejection at 1.1600: Is the Dollar Ready to Take Control?

Forex

Summary:

On 11 September 2026, EUR/USD is trading around 1.1605–1.1610, with price struggling to regain the 1.1630–1.1633 resistance zone. The short-term bearish case is supported by a stronger U.S. dollar, rising Treasury yields and a sharp increase in expectations for a Fed rate hike next week.

SELL EURUSD

EXP

TRADING

1.16000

Entry Price

1.15700

1.16350

1.15972 -0.00117 -0.10%

0.0

Pips

Flat

1.15700

Exit Price

1.16000

Entry Price

1.16350

Overview

EUR/USD is currently sitting at a technically important level rather than in a clean directional trend. The pair traded around 1.1609 on Friday, while the ECB's latest 25-basis-point rate hike to 2.50% has failed to generate sustained euro strength because the move was already widely anticipated by markets. The more important development for the immediate M15 direction is the U.S. side of the rate differential. U.S. PPI increased 0.4% in August, while the 10-year Treasury yield has moved close to 5%, strengthening the dollar and increasing the probability of a 25-basis-point Fed hike at next week's meeting to approximately 71%.

This creates a meaningful asymmetry around 1.1600. EUR/USD has already fallen toward this psychological level, but if buyers cannot reclaim 1.1630–1.1633, the market remains vulnerable to another leg lower. The ECB has also opened the door to further tightening because of elevated energy-driven inflation, but this is not automatically bullish for EUR/USD: higher European energy costs can simultaneously hurt Eurozone growth and increase recession concerns. Therefore, the euro's rate advantage is being offset by the dollar's safe-haven demand and stronger U.S. yields.

Market Sentiment

The current sentiment favors the dollar in the immediate term. Middle East energy disruptions have pushed oil above $100, increasing global inflation concerns and causing investors to demand higher bond yields. The U.S. dollar index is around 99.08 and close to its strongest level of the week, while the U.S. 10-year yield has approached 4.96%. This is particularly relevant for EUR/USD because higher U.S. yields increase the opportunity cost of holding euro-denominated assets relative to dollar assets.

However, selling exactly at 1.1600 carries a significant reversal risk. The pair has repeatedly treated the 1.1600–1.1620 region as a major support/confluence area, and recent technical analysis identifies 1.1632–1.1633 as the first meaningful resistance while 1.1564–1.1578 is the next support region. In other words, the trade becomes substantially stronger if 1.1600 changes from support into resistance rather than simply selling into support. The upcoming U.S. CPI release is therefore the major catalyst: a hotter-than-expected number could reinforce the Fed-hike narrative and accelerate EUR/USD downside, while a softer number could trigger a sharp short squeeze.

Technical Analysis

EUR/USD Faces a Key Rejection at 1.1600: Is the Dollar Ready to Take Control?_1

On the M15 timeframe, the SELL setup is based on rejection around 1.1600 combined with the broader failure below the 1.1630–1.1633 resistance structure. With Bollinger Bands (20,0,2), price is positioned near the lower half of the recent range, indicating that bearish momentum has already developed but also warning against chasing a move after an extended candle. The preferred structure is therefore a retest of 1.1600 followed by an M15 rejection rather than selling after a large impulsive decline.

The Ichimoku (9,26,52) framework favors the short side if price remains below the Kijun-sen and the M15 cloud continues to act as overhead resistance. A failure to reclaim the Tenkan/Kijun structure would indicate that the rebound is corrective rather than a genuine trend reversal. The Stochastic (5,3,3) is particularly important here: if it rises from the lower zone and then crosses downward again near 1.1600–1.1620, that would provide a better momentum confirmation for the SELL. Conversely, a strong bullish Stochastic cross accompanied by an M15 close above 1.1633 would weaken the setup considerably.

The first downside objective is the 1.1570 area, which is consistent with the current technical support structure. If that level breaks decisively, the next extension becomes approximately 1.1530–1.1540. The key invalidation remains above 1.1635 because a sustained M15 recovery through that zone would indicate that sellers failed to convert 1.1600 into resistance. Given that EUR/USD is sitting close to a major support area, this is a confirmation-dependent SELL, not an aggressive market sell.

Trade Recommendation

Entry: 1.1600

Take Profit: 1.1570

Stop Loss: 1.1635

Risk Warnings and Disclaimers

You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.

Risk Disclosure

The risk of loss in trading financial instruments such as stocks, FX, commodities, futures, bonds, ETFs and crypto can be substantial. You may sustain a total loss of the funds that you deposit with your broker. Therefore, you should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources.

No decision to invest should be made without thoroughly conducting due diligence by yourself or consulting with your financial advisors. Our web content might not suit you since we don't know your financial conditions and investment needs. Our financial information might have latency or contain inaccuracy, so you should be fully responsible for any of your trading and investment decisions. The company will not be responsible for your capital loss.

Without getting permission from the website, you are not allowed to copy the website's graphics, texts, or trademarks. Intellectual property rights in the content or data incorporated into this website belong to its providers and exchange merchants.

Recent Searches

Top Searches

Markets

Analysis

User

24/7

Economic Calendar

Education

Data