EUR/USD Tests 1.1370 Support: Can Oversold Conditions Trigger an M15 Rebound?

Forex

Summary:

EUR/USD is trading around 1.1370–1.1375 after falling to a fresh multi-week low, with broad USD strength driven by hawkish Fed expectations and US yields above 5% keeping pressure on the pair. ...

BUY EURUSD

Close Time

CLOSED

1.13700

Entry Price

1.13900

1.13450

1.14024 +0.00234 +0.21%

20.0

Pips

Profit

1.13450

1.13900

Exit Price

1.13700

Entry Price

1.13900

Overview

EUR/USD has entered September 25 under significant selling pressure. The pair traded around 1.1372 on September 24, close to a two-month low, while the US Dollar Index reached approximately 101.35, its highest level since late July. The main fundamental driver is the widening interest-rate differential between the US and Eurozone. Strong US economic data, combined with hawkish Federal Reserve rhetoric, has increased expectations for another Fed rate hike, while the US 10-year Treasury yield has moved above 5.10%.

This environment remains fundamentally negative for EUR/USD. Sucden Financial reported that the US flash Composite PMI reached 58.4, its strongest level since July 2021, while market-implied expectations for an October Fed hike rose toward 70%. At the same time, the Eurozone Composite PMI improved to 53.1, but that improvement has not been sufficient to offset the dollar's yield advantage.

The reason 1.1370 remains interesting for a BUY is positioning and technical location. Daily support is identified around 1.1361, followed by 1.1346, while the June low near 1.1329 represents a much larger structural support reference. A controlled M15 rebound from 1.1370 could therefore target the nearby resistance cluster rather than requiring a complete trend reversal.

Market Sentiment

Sentiment remains strongly dollar-positive. EUR/USD has declined approximately 0.62% over the latest reported 24-hour period and is approaching its yearly trough, while US yields and expectations for additional Fed tightening continue to attract demand toward the dollar. Current technical data also remains bearish: Investing.com reports RSI around 42, negative MACD and a Strong Sell overall technical classification, while the 20-, 50-, 100- and 200-period moving averages remain above price.

However, the sell-off is becoming increasingly stretched. The broader daily RSI cited by Sucden Financial was around 22, indicating deeply oversold conditions. This creates the main argument for the BUY: not fundamental euro strength, but the possibility of short-covering and mean reversion after an extended decline.

For M15, the critical distinction is whether 1.1370 becomes a floor or simply another pause before 1.1346. A bullish reaction accompanied by higher lows would strengthen the rebound setup; repeated M15 closes below 1.1360 would invalidate the idea.

Technical Analysis

EUR/USD Tests 1.1370 Support: Can Oversold Conditions Trigger an M15 Rebound?_1

Using Bollinger Bands (20,0,2), Ichimoku (9,26,52) and Stochastic (5,3,3), the preferred M15 BUY structure is a rejection of 1.1370 followed by a recovery toward the Bollinger mid-band. The pair is trading near the lower portion of its recent volatility range, so an M15 close back above the middle Bollinger Band would indicate that downside momentum is beginning to fade.

With Ichimoku (9,26,52), price remains structurally bearish while below the Kijun-sen and cloud. Therefore, the BUY should be treated as a tactical rebound until price reclaims the M15 Kijun. A higher low around 1.1365–1.1370 followed by a Kijun recovery would provide stronger confirmation.

For Stochastic (5,3,3), the ideal trigger is a bullish crossover from the lower zone while price simultaneously holds 1.1370. Stochastic alone is insufficient because EUR/USD can remain oversold during a strong trend, but a crossover combined with support rejection would provide useful M15 confirmation.

The immediate upside levels are approximately 1.1377–1.1381, followed by 1.1389–1.1400. The downside invalidation zone is 1.1346, with the June low at 1.1329 becoming the next major reference if that support fails.

Trade Recommendation

Entry: 1.1370

Take Profit: 1.1390

Stop Loss: 1.1345

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EUR/USD Tests 1.1370 Support: Can Oversold Conditions Trigger an M15 Rebound?

Overview

Market Sentiment

Technical Analysis

Trade Recommendation

Risk Disclosure