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The EUR/USD decline may have only started

EUR/USD has fallen below 1.176 as demand for the US dollar strengthens, opening the door to further losses towards 1.158 and possibly 1.147. Momentum indicators suggest downside risks remain.

Michael J Kramer

Founder, Mott Capital Management

Geopolitical tensions drive dollar demand

Rising geopolitical tensions in the Middle East have triggered a flight to safety into the US dollar, pushing EUR/USD below a key support level at 1.176. The breach of support suggests EUR/USD could head lower towards the next support area at 1.158, which may only be the beginning.

Descending triangle points to deeper losses

The decline in EUR/USD could extend, as it appears to have formed and confirmed a descending triangle pattern since peaking on 27 January. A 100% extension of that pattern would suggest EUR/USD could fall to as low as 1.147.

EUR/USD is also trading below its 50-day moving average, marking a significant loss of support for the exchange rate. In the past, this moving average has acted as both support and resistance for EUR/USD. That now suggests it could turn into a resistance level.

Source: TradingView, 2 March 2026

Momentum and volatility indicators in focus

The one caveat is that EUR/USD is now testing the lower Bollinger band, which could provide some support. However, the band itself is trending lower at present, so while it may offer near-term support, it is more likely to act as a level from which EUR/USD could stage a temporary bounce rather than signal a sustained reversal.

At this point, the Relative Strength Index (RSI) remains too high at 39.50 to suggest that EUR/USD is oversold. It would need to fall below 30 for oversold conditions to be indicated.

Source: TradingView, 2 March 2026

The Week Ahead: ISM data, Broadcom, US jobs

Welcome to Michael Kramer’s pick of the key market events to look out for in the week beginning Monday 2 March.

The USD/JPY may be heading much higher

USD/JPY has pushed higher after new Bank of Japan appointments raised expectations of more reflationary policy and a weaker yen. The move brings key resistance levels and the risk of government intervention back into focus.

US homebuilding rebounds, potential early-cycle economic shift

Data on housing starts rose to their highest level in five months, suggesting improving momentum heading into the year.