EUR/USD Analysis 20/11: Euro Drops Below 1.15 Support Amid Fed Policy Uncertainty
By Mahmoud Abdallah, November 20, 2025
The EUR/USD currency pair continues to display bearish momentum as it successfully broke through the key support level of 1.15, marking a notable shift in the market’s outlook. Following a nearly half-percent decline (-0.48%) during Wednesday’s trading, the euro-dollar exchange rate hovered around 1.1517 at the time of writing, raising the potential for a bearish close to the week.
Current Market Trend and Technical Levels
- Overall Trend: Bearish
- Key Support Levels: 1.1500, 1.1440, 1.1380
- Resistance Levels: 1.1590, 1.1650, 1.1780
Wednesday’s decline pushed the EUR/USD below the 1.15 threshold, a psychological and technical support area that bears had been eyeing. Indicators reinforce the downtrend, with the 14-day Relative Strength Index (RSI) dropping toward 40, inching closer to oversold territory should selling pressure intensify. Additionally, the Moving Average Convergence Divergence (MACD) is pointing downward, confirming bearish control.
Trading Signals and Recommendations
- Long Position: Consider buying EUR/USD near the support at 1.1460, targeting a rebound to 1.1800 with a stop-loss set at 1.1390.
- Short Position: Sell EUR/USD around resistance at 1.1665, aiming for a drop toward 1.1400 and a stop-loss at 1.1780. Traders should remain cautious, as the pair is likely to test lower lows before any sustainable recovery can be considered. The path toward a bullish reversal requires a significant move above the psychological resistance at 1.18, which currently seems unlikely given market dynamics.
Influences Behind the Decline: Fed and ECB Interest Rate Outlooks
The US dollar’s strength amidst fading expectations for future Federal Reserve rate cuts continues pressuring the euro. Minutes from the Fed’s latest meeting, released Wednesday, reveal sharp divisions among policymakers concerning the probability of a December rate cut. While some support easing monetary policy, others favor keeping rates stable for the remainder of 2025. The Federal Reserve has already reduced benchmark interest rates twice this year—from 4.1% to around 3.9% in October—and projections once anticipated three cuts this year. Yet, uncertainty remains tied to economic indicators such as employment figures and inflation, which are offering conflicting signals on the best course for rate policy.
Conversely, the European Central Bank (ECB) appears poised to maintain its current interest rates well into 2026. Inflation close to the 2% target, stable economic growth, and record-low unemployment are key factors behind the ECB’s decision to hold rates steady, as evidenced by the unchanged interest rates in October for the third consecutive meeting.
Market Outlook and Upcoming Catalysts
Traders and investors closely await the upcoming US jobs report, a critical factor influencing Federal Reserve policy direction and, consequently, the EUR/USD pair’s trajectory. The report’s outcome could either alleviate or exacerbate concerns about economic slowdown or inflation persistence, tipping the scales in favor of further rate cuts or maintained tightening.
In addition, domestic US political developments, including the aftermath of the longest government shutdown in US history, add another layer of uncertainty impacting market sentiment.
Summary
The EUR/USD pair is currently entrenched in bearish territory following a decisive break below 1.15 support. Technical indicators support further downside potential, conditional on upcoming economic releases and central bank policy signals. The euro faces headwinds amid a resilient US dollar and cautious ECB stance. Traders should exercise prudence, adhering to recommended stop-loss levels and closely monitoring market-moving data over the coming days.
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About the Author
Mahmoud Abdallah brings over 12 years of full-time experience in the foreign exchange markets, offering technical analysis, market commentary, and forex signals. His expertise is widely recognized across prominent financial websites in the Arabic-speaking world, catering to both novice and experienced traders.
Disclaimer: Forex trading carries high risk, including potential capital loss. This analysis is for informational purposes only and does not constitute financial advice. Traders should evaluate their financial situation carefully before trading.
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